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Filecoin Miners Go on Strike: Claim the Project’s Economic Model Is Not Working

Lately, there’s been great hype surrounding the Filecoin project: a system from Protocol Labs with the objective of being both a decentralized file storage and a content distribution network. However, in the last few weeks before the launch, there have been quite a few criticisms and accusations against Filecoin. 

A Series of Filecoin Controversies

The Filecoin (FIL) token offering had already sparked a lot of controversy when some in the crypto community pointed out how an unknown account had received around 1.5 million tokens from Filecoin – even though only 500,000 were due to be unlocked- and about 800,000 of those tokens were sent to exchanges like Huobi. Now, according to a number of social media posts, some Filecoin miners have gone on strike since the evening of October 17. They have claimed that the platform is not compatible with them; stating that the economic model is contradictory and they aren’t able to profit. 

Lai Chuhang, the initiator of the IPFS Chinese community and the chairman of Space Cloud Technology, explained how the Filecoin economic model is still lacking. He says, “If this situation continues, 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.”

Meanwhile over on Twitter, a user discusses in this thread why within only 24 hours of launch, a great number of FIL miners have gone on strike. The tweets explain:

“Filecoin is very complex and requires high-end hardware, including min 128GB mem. Example of one miner, that is three servers with two computing and one storing, from 6block. Price is a very high retail $40k (includes hosting and maintenance ), regular prices minimum $20k, 350TB. Sealing speed is the bottleneck, you can provide a lot of space but with two 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. 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.)”

In response to the discontentment of the miners, a member of the Protocol Laboratory suggested the miners recognize the project’s proposal of FPI-004– which can apparently help solve some of the issues FIL miners have raised. The representative had this to say:

“Only if we cooperate, the network can get better. 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.”

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