Filecoin

Filecoin Miners Start a Strike – FIL Validators Claim the Project’s Economic Model Is Not Working

20/10/2020 by Idelto Editor

The Filecoin project has surely seen a lot of hype but during the last few weeks before the launch, the cooperative digital storage crypto project has been criticized a great deal. This weekend a few Filecoin miners have been on strike and claim the economic model is not working out for them.

Just recently the Filecoin (FIL) token offering has been a topical conversation, as the project joins the cryptocurrency economy. Moreover, controversy recently surrounded the project when the crypto community questioned the movement of 800,000 FIL tokens. Now another story is arising that shows a few FIL miners are striking because the economic model is conflicting and they allegedly cannot profit. That’s according to a number of social media posts and an interview with a number of leading FIL mining operators.

For instance, the chairman of the firm Space Cloud, Lai Chuhang, explained how the Filecoin economic model is currently inefficient and noted the “community consensus may split.”

“If this situation continues,” Chuhang said. “Miners will have to buy coins at high prices in the secondary market. Obviously it’s not worth it. In the current situation, community consensus may split, and the project may be worrying.”

On Twitter, the account called ‘Nico Deva’ discussed why after 24 hours of launch, a majority of FIL miners are on strike and discussing “a failed wedding and forks.”

“Filecoin is very complex and requires high-end hardware, including min 128GB mem,” Nico Deva tweeted. “Example of [one] miner, that is [three] servers with [two] computing and [one] storing, from 6block. Price is a very high retail [$40,000] (includes hosting and maintenance ), regular prices min. $20k, 350TB. Sealing speed is the bottleneck, you can provide a lot of space but with 2 computing servers you can still only seal about 1TB/day for your 336TB of storage, and it can take from 210 to 350 days to use and mine with the actual full space.”

Deva continued by adding:

Meanwhile, you need to stake FIL as collateral for the space provided, this is a guarantee and is slashed if space commitment is not honoured (the goal being to insure that data isn’t lost). But that’s a chicken and egg [problem], as nobody has FIL to start mining and get FIL.

Deva concluded by saying: “Here in China people are disgusted, 恶心, this is the word repeated.” According to the interview with Filecoin miners, one of the Filecoin community members explained that miners should appreciate the project’s proposal of FPI-004. Allegedly FPI-004 can help solve some of the problems FIL miners are dealing with.

“Only if we cooperate, the network can get better,” the Filecoin community member said. “Whether to take special improvements is up to the community. Generally speaking, if people with ideas for improvements can help build them, the ecosystem will get better.”

What do you think about the problems Filecoin is facing? Let us know what you think in the comments section below.

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Filecoin Offering: Community Alleges Token Dumping, Tron’s Justin Sun Wants the US SEC to Investigate

17/10/2020 by Idelto Editor

The recent Filecoin (FIL) token offering is creating controversy as some crypto community members are alleging that an unknown account has received 1.5 million tokens when only 500,000 were due for unlocking. According to reports, 800,000 tokens out of the 1.5 million of such tokens have been transferred to Huobi and other exchanges.

Filecoin Denial

According to a Chinese language website, 8btc.com, an unidentified Filecoin representative insisted the decision was made to help stabilize the price in the period after listing.

The representative reportedly said:

It is to establish an independent market maker to (help) maintain a stable price in the early stage of the project, because the price may be the most unstable at this time. At the same time, these coins are not a sell-off of FIL by the Filecoin.

As part of the plan, FIL tokens were also sent to other exchanges besides Huobi. Meanwhile, the Filecoin team also explained in a blog that “the network has now entered a quiet post-launch monitoring period to ensure the network is operating smoothly.” The blog adds that the “network is stable and community members are reporting successful operations.”

Token Price Tanks

Despite this plan, the Filecoin token saw its price tank a few hours after listing. It seems the envisaged stabilizing strategy failed to stop the token price from dropping. As Binance trading data shows, the token opened at $200 but this had dropped to $42 at the time of writing. It is this sharp drop from the opening price that has prompted complaints and allegations of impropriety.

One notable critic of the FIL offering is controversial Justin Sun who is insinuating that one Juan Benet and others at Filecoin had exit scammed. Tron tweets:

“Exit scam here? 1.5 million $FIL for 200 USD each worth 300 million USD at the high. Now (the) price is below 60 USD. 70% down. No lock-up. No announcement to the community. How much do you sell? Is this ok?”

Sun, who has faced almost similar allegations, goes on to encourage investors, especially those from the United States “to make sure Filecoin and Juan Benet are held responsible for this (dumping) under the protection of the US Securities and Exchange Commission.” Some Twitter users appeared to agree with Sun while some were quick to remind him of his own past misdeeds.

Still, in a later tweet, an undeterred Sun doubles down on his claims that FIL devs had disregarded the rules by dumping 1.5 million tokens.

Counterfeit FIL Tokens

Meanwhile, in another twist to the controversy, reports also emerged on October 16 that scammers may have forged FIL tokens.

According to the Beijing-based Chainsmap monitoring system, these tokens were created a day before the offering while their transfer to addresses had been carried out by way of airdrops. In addition, a transaction pair pool has been established in Uniswap with this token.

Launched as a decentralized storage network, the Filecoin team says the project was started to help “store humanity’s most important information.” The project raised $205 million in an initial coin offering in 2017, and while the launch date was initially planned for mid-2019. However, the mainnet launch date was pushed back until block 148,888, which is expected in mid-October 2020.

What are your views about the Filecoin dumping allegations? Tell us what you think in the comments section below.

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Crypto Experts Give Their Top Predictions for 2020

19/12/2019 by Idelto Editor

In an industry built around digital scarcity, opinions are in plentiful supply. Everyone’s got one, and they’d love to share it with the rest of the cryptosphere. As the decade draws to a close and another prepares to launch, it’s the perfect time to consider what 2020 has in store. Here’s what thought leaders, professionals, and investors have to say about the trends that will define the coming year – starting with the predicted price of BTC.

Also read: Which Token Will Be Next Year’s 50x Winner?

In 2020, the price of BTC Will Reach…

Where BTC will venture next year depends heavily on whether you believe May 2020’s halving event is priced in – which no one can seem to agree on. The rational market theory holds that investors have had years in which to prepare, and thus the slashing of BTC’s block reward should have little effect on pricing. But since when have “rational” and “crypto markets” ever been synonymous? “Bitcoin needs bigger macro catalysts than a marginal 2% point reduction in inflation rates,” believes Messari’s Ryan Selkis. Yele Bademosi of Binance Labs expects that “the lowest price of BTC in 2020 will be higher than the yearly low of 2019 (~$3,300).”

Blockchain Capital believes BTC will surpass $20k in 2020, as does Su Zhu of Three Arrows Capital, while a partner at The Spartan Group believes bitcoin will reach $40k, and he’s not alone, with other bulls including Bithumb’s Seonil Moon, who has predicted that “in 2020, institutional investors will move beyond testing and will start to create new demand for crypto.” With Bitcoin Cash also due to halve its block reward next year, and Blockchain Capital predicting onchain BTC fees to hit $100, 2020 may also smile kindly on BCH. Next year’s biggest bull is John McAfee, of course, but no one in the industry believes his $200k EOY prediction for BTC will come to pass.

Blockchain Networks to Watch out for in 2020

The severity of the threat presented by quantum computing remains a matter of intense debate, with new breakthroughs in quantum supremacy by Google focusing attention on the security of crypto networks. There’s less debate over the prominence that quantum-resistant networks will play next year, which several crypto crystal ball-gazers have tipped to prosper in 2020. This includes Quantum Resistant Ledger, which has obtained draft approval from the National Institute for Standards and Technology (NIST) for Stateful Hash-Based Signature Schemes, the technology that secures its blockchain.

Also tipped to prosper are smart contract blockchains that can rival Ethereum. In his 71-page Crypto Theses for 2020, Messari’s Ryan Selkis has highlighted Polkadot, which is set to launch next year, and Cosmos as the likeliest to succeed in this regard. He’s predicted that high volume dapps such as Earnbet, which has encountered scaling problems on EOS, will “build on their own Polkadot parachain or Cosmos zones.”

Web3 Protocols Tipped to Gain Ground

The decentralized web, borne along by Web3 technologies including IPFS, is also expected to come good in 2020. With Twitter’s Jack Dorsey launching Bluesky, a decentralized social media protocol, the spotlight has been shone on a vertical that promises to return data control to its owners and spawn censorship-resistant web platforms. On December 18, the New York Times addressed this trend, with Nathaniel Popper observing that “Decentralization used to be the thing the upstarts said would allow them to defeat Twitter and Facebook. Now Twitter and Facebook have adopted it as the solution to all the problems they are facing.”

Web3 projects that are projected to prosper next year include Cyber, a protocol that operates on top of IPHS (Interplanetary File System), providing an information consensus system for answers and a search engine. Its Interplanetary Search Engine and consensus computer will essentially form a decentralized Google that utilizes knowledge graphs. Permaweb storage solution Arweave, decentralized DNS Handshake, and Filecoin, which will launch in 2020, will also play a key role.

Next Year’s Likeliest to Succeed Altcoins

News.Bitcoin.com recently shared a list of predictions on the tokens likely to fare well in next year’s market. To that list can be added DOT – Polkadot’s native token – which Spartan Black expects to eventually reach a market cap in excess of Ethereum’s, reasoning “In China, it is the only project that comes anywhere close to Ethereum in terms of profile, community and investor interest.” He also expects Maker’s MKR to exceed $1,000.

Experts are less bullish on Telegram’s TON and Filecoin in terms of valuation, on account of the projects having launched late and raised amidst peak 2017-18 valuations. Blockchain Capital has predicted that none of the layer one networks to launch in 2020 will enter the top 10 by market cap. Spartan Black expects SNX and BAT to increase their market caps next year, but DOGE, NEO, and ICX to lose ground. Finally, Bram Cohen of Chia predicts that tether (USDT) will become the third largest digital asset by market cap.

Exchange Predictions

Coingecko’s Bobby Ong is skeptical that the exchange blockchains being developed by Huobi, Bithumb, Gate.io, and Okex will prosper next year, but is bullish on crypto derivatives, predicting that “Most crypto exchanges will start offering options to compete against Deribit.” Ari Nazir of Neural Capital anticipates that “Exchange tokens will continue to be the strongest performing non-vaporware investments in crypto.”

Bybit’s Ben Zhou has taken a more philosophical view of next year’s exchange landscape, telling news.Bitcoin.com: “As always, crypto remains a highly competitive market. I enjoy the constant competition as it reminds us to never rest on our laurels. However, we do not want to get too wrapped up in competing that we lose sight of our own goals. As Edward de Bono once said, ‘Companies that solely focus on competition will die. Those that focus on value creation will thrive.’”

These are my guesses for 2020 pic.twitter.com/ESa2Hgtukq

— nic carter (@nic__carter) December 19, 2019

Staking as a service, which is now dominated by exchanges, is tipped to wither away next year due to saturation and increased awareness of the dilution caused by inflationary staking networks. “Staking fees will drop to near zero in 2020 and more than half of the 200+ stakers will go out of business,” predicts Spartan Black. Both he and Bobby Ong anticipate staking fees levied by exchanges will be slashed in a bid to compete with Binance. Ryan Selkis, meanwhile, cut straight to the point, writing “inflationary staking rewards are without qualification the dumbest thing this industry has deluded itself into believing since white paper investing caught fire in mid-2017.”

Decentralized Finance

Predicting the amount of value locked up in decentralized finance has become a variant on the annual BTC price prediction game. Defipulse.com currently records this figure as $645M, with Bobby Ong expecting $1B to be surpassed next year. Blockchain Capital is more bullish still, tipping $5 billion. Ong has also predicted that at least one defi app will be hacked next year, as does Charlie Noyes of Paradigm who projects that “at least one DAO is taken over by overtly malicious colluding voters for >$1mm in profit.”

Ryan Selkis anticipates further VC investment in defi-based wallet services “to compete as the gateways to crypto for “self-sovereign” crypto users.” The Block has predicted that next year will see greater leverage for defi derivatives, more liquidity, and more sophisticated financial products.

Bitcoin layer two solution Lightning Network, whose $6.2M of locked up BTC is recorded by defi aggregators such as Defipulse, may not fare so well next year. As news.Bitcoin.com recently showed, LN still isn’t ready for the masses, and even some of its former proponents have changed their tune. “Lightning is taking more time to develop than I’d originally thought,” conceded Ryan Selkis, writing that “it’s tough not to be disappointed with its lack of growth” in 2019.

Whatever 2020 may hold for bitcoin, altcoins, and the rest of the cryptoconomy, investors are eagerly looking forward to the dawn of a new decade. It’s a chance to wipe the slate clean and start with renewed determination to avoid shitcoins, dubious ICOs, and outright Ponzi schemes. Only time will tell whether the coming year will smile kindly upon the cryptosphere, bringing profitable trades and vindicated predictions to the current crop of crypto clairvoyants.

What are your crypto predictions for 2020? Let us know in the comments section below.

Images courtesy of Shutterstock.

Did you know you can verify any unconfirmed Bitcoin transaction with our Bitcoin Block Explorer tool? Simply complete a Bitcoin address search to view it on the blockchain. Plus, visit our Bitcoin Charts to see what’s happening in the industry.

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ICO Treasuries Offloaded the Most ETH in November and December This Year

28/12/2018 by Idelto Editor

Over the Last Two Months ICO Treasuries Withdrew the Most ETH

Over the course of 2018, failing initial coin offerings that raised billions last year have continued to dominate the news cycle. Despite ethereum losing more than two thirds of its value, ICO projects have been liquidating massive amounts of ETH. ICO treasuries cashed out 433,000 ETH ($52.4M) in December, surpassing every other month this year.

Also Read: The 2018 Bitcoin Mining Ecosystem Saw Record Hashrates and New Devices

After Ethereum’s Price Dropped 84%, ICO Treasury Withdrawals Increased

One of the biggest stories of 2017 was how initial coin offerings (ICOs) raised billions. 2018 was a different story, with the recurrent themes being regulatory action against ICOs and the majority of these projects failing miserably. In February, research by news.Bitcoin.com revealed that over 46 percent of 2017’s ICOs had failed. Seven months, ago ICOs had a failure rate of 92 percent, showing the world that even though a project can raise millions it won’t necessarily go on to be successful. Furthermore, many of the ICOs trying to survive the 2018 bear market have been cashing out large amounts of ETH from their treasuries. Diar Research details that 433,000 ETH was withdrawn from ICO treasuries this month despite the fact that ETH’s value hit record annual lows in December.

“Ethereum has dropped 84% in price from the start of the year when ICO treasuries saw massive activity with withdrawals being the highest they ever were this year,” explains the chart created by Diar Research.

The researchers also detail that November (290,000 ETH withdrawn) was the second largest withdrawal period this year. Diar states that Tezos withdrew 82,000 ETH and Aragon moved 40,000 into the Ethereum stablecoin dai. The third highest month was in January, which saw a total of 232,000 ETH withdrawn from ICO treasuries. “As a whole, 24 percent from the start of the year has moved from the 100 wallets assessed — But what was worth $3 billion is now only $350 million,” explains Diar.

Out of 50 ICOs, Filecoin Cashed out Close to Half of the Month’s Treasury Withdrawals

Diar has shared a comprehensive spreadsheet which details 50 of the highest grossing ICOs and how much money they started with in January and how much they withdrew in 2018. Big name projects such as Digixdao, Polkadot, Golem, Tezos, and Filecoin are included in Diar’s informative table alongside treasury account holdings. Statistics show that Filecoin withdrew its entire stash of 216,906 ETH this December, which encompasses about half of the month’s total withdrawn coins. A few other projects also liquidated their entire treasury accounts this year and some projects have very little ETH left.

The research also explains that 2018’s average withdrawal rate was only about 2.4 percent, but December exceeded most months with 12 percent. Of course, withdrawing coins doesn’t necessarily mean the project failed, but that the team may have tried to avoid ETH’s volatility by using a stablecoin or converting to fiat. However, if they did convert to a stablecoin or some form of fiat then they would have gotten more bang for their buck if they cashed out earlier. It is strange that many of the projects withdrew the most ETH during November and December when ETH was at its lowest price range of the year. When these projects were faced with a burn rate that outpaced the funds on hand, they may have been left with no other choice.

What do you think about ICOs cashing out the most ETH during the months of November and December? Let us know what you think about this subject in the comments section below.

Images via Shutterstock, and Diar Research.

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