Siacoin: Decentralized & Cost-Effective, Blockchain-Based Cloud Storage

Siacoin Maintains Strong Market Cap

Siacoin (SC) was released in 2015 by Nebulous Inc., a company that operate a network of cloud storage platforms. At the time of this writing, each Siacoin is worth roughly $0.011 and has a total circulating supply of 33.3 billion coins. This yields a market cap of over $400 million, making it the 34th largest cryptocurrency platform in terms of market capitalization.

Considering there are thousands of different cryptocurrencies, this indicates that Siacoin is one of the most popular and widely circulated cryptos in the world. Therefore, if you are a crypto enthusiast, it would be a good idea to know about and understand Siacoin.

A Cloud Storage Crypto-Platform

Siacoin is the currency of the Sia platform, which provides decentralized blockchain-based cloud storage. Currently, Sia consists of 915 hosts around the world who are hosting 214 terabytes of files, and these hosts are paid with Siacoin to store files. Smart contracts are entered into and paid with Siacoin at the time the user stores files; the file host is required to keep coins in escrow and is not paid until the agreed upon term of file storage is completed.

This gives the user 100% peace of mind that they won’t get ripped off, because if their files aren’t stored for the full term, their money is returned. It costs about $2 per terabyte per month to store files on Sia, which makes it 90% cheaper than major cloud storage platforms like Amazon. This cheap storage price alone makes Sia very attractive for users, but what makes Sia really unique is its cryptographic privacy and decentralized nature.

When a user uploads a file to Sia, it is split into many pieces and each piece is encrypted. Then, these encrypted pieces are stored with different hosts across the network. This makes it impossible for hosts to view users’ files, unlike centralized cloud storage offered by Amazon, Dropbox, and Google. On these platforms, the host has access to the full files and can view, edit, and delete your files.

Cryptographically Secured Files

The only way to view a file on Sia is with the cryptographic private key provided to the user at the time the files are stored. A decentralized file storage service like Sia is essential to preserve freedom in our world. Censorship and invasion of privacy by the government and corporations has rapidly increased this century. The unique decentralized and cryptographically secure storage technology of Sia ensures that any file can be stored without question, no matter what it contains. Sia has the potential to help businesses keep their files and the ideas within them secret.

Mining On Sia & Rewards

Initially, there were 300,000 Siacoins mined per block, and for each consecutive block, the reward declines by 1 coin. This decline in block reward will continue until there are 30,000 Siacoins rewarded per block. Once this is reached, the reward will remain fixed at 30,000. The developers mined 100 blocks before releasing the mining software to the public, yielding 30 million coins for themselves.

Extreme Price Volatility

The price of Siacoin was initially less than 1/100 of a penny when it first hit the exchanges, and steadily climbed through the years to a peak of 2 cents in June 2017. The price declined after this to less than half a cent, but eventually began to rise again and hit an all-time high of 11 cents in January 2018. This coincided with the time that the entire cryptocurrency market was in a speculative bubble; Bitcoin hit a record high of nearly $20,000 around this time.

Only Crypto You Can Use To Pay For File Storage 

The price of Siacoin then dropped rapidly, losing about 90% of its value. This behavior is indicative of a pump and dump, a classic phenomena on the cryptocurrency markets (and traditional financial markets) where speculators buy up a lot of coins. This causes a rapid increase in price, before dumping lots of coins and reversing the rally into a crash. Ignoring the pump and dumps, in the long term, the price of Siacoin has been steadily rising.

I expect this to continue due to its intrinsic value as the only currency that can be used to pay for file storage on the Sia platform. Considering the unique and beneficial attributes of decentralized blockchain-based file storage on Sia and its cheap cost per terabyte, I expect more and more people to use Sia as their primary cloud storage provider.

This is not advice.  Advice should be accepted by your chosen legal counsel only and financial advice should come from a licensed or certified financial professional. As always – do your homework and make decisions based on your own education.  Seek information and look into projects before adding to or diversifying your portfolios.