A crypto-trader’s diary — week 11; storage coins – Info Gadgets

Now, on to the many-faceted world of ‘ ‘. There’s not really a clean way to compare Sia, Storj, Filecoin, MaidSafe, and Shift, but my favourite type of internet comment is “you oversimplified these things when making a comparison between them!!!”.

So I’m going to do exactly that.

Storage coins

I think a lot about wasted resources. Idle CPUs, empty hard drives, my two seater lounge.

I work in an office surrounded by 101 people poking away at MacBook pros — I’m basically sitting in a supercomputer that lies unused for 16 hours a day. It seems like being able to harness this power to train our ML models would be a really neat use of technology.

So when I hear about plans to harness the world’s unused disk space, making money for the owners and providing cheap storage for the users, I get more than a little excited.

I get a lot excited.

I’ve got the hots for the theory, let’s look at the reality…

Existence

Sia exists. Good for Sia.

In one way this map is impressive, in another way it makes me want to wear a gas mask and stock up on supplies, and in a third way it’s surprising that there’s only 176 TB being stored.

I don’t want to demean any efforts, but 176 strikes me as shockingly low for something three years old. One guy alone — who I will forget to mention later — uploaded at least 5 of those 176.

Regardless, Sia is out in the wild, spreading around the world like an international travelling butter knife salesman.

Storj (who accidentally spelled storage wrong but have doubled down on that mistake) appeared to exist at some point in 2016 and 2017, but now seem to not exist in the traditional sense. I can “request early access” and they “expect to release the new version by the end of 2018”.

MaidSafe was thought about in 2002, work began in 2006, and an alpha released in 2016. Now, in 2018, they’re up to Alpha 2. That’s, um, a long time.

Shift exists too. Perhaps starting with ‘s’ is the key here. Shift is a little bit different, they’re a layer on top of IPFS. I only discovered them today so I don’t have anything more to say about that. Sorry Shift.

Filecoin is a work in progress (and spoiler alert, pretty exciting). The people that will eventually get around to bringing us Filecoin (Protocol Labs) will also bring us IPFS — the InterPlanetary File System.

I originally wrote a really long summary of my investigation into the coins that exist. But in the end, I was so disillusioned by the available opportunities that I’ve dropped all that.

Instead, here’s a summary of my disillusionment:

I’m not quite sure that the incentives make sense. Say you want to advertise that you can supply storage for $2 per terabyte per month, like Sia does. You’ll want to store that terabyte in at least three places so it’s available even if some people are offline. Which means you can pay each of those people 66c per terabyte per month.

Maybe I like the idea of earning cash-for-capacity, so I buy at 1 TB drive for $80. If I’m lucky enough to have the whole drive filled all of the time, then at 66c a month I’ll have paid it off in a mere … 10 years.

Let’s say I don’t actually buy a drive, but I have 500GB spare. Could I be bothered doing a whole lot of setup, running software, and leaving my computer on 24/7 to earn a maximum of 33 cents a month? That’s exactly zero dollars when rounded to the nearest dollar.

So it will only be with economies of scale that this system makes sense. At which point your data is going to be in large data centres. Owned by organisations. And possibly all three copies will be with the same organisation. And when it no longer makes sense for them to be in business, they’ll close their doors.

So, just like it is now, but with no SLAs.

The verdict

I heard a guy on a podcast this week being quite disparaging about ‘storage coins’, saying something like “a lot of these kids are quite young, and I don’t think they fully understand how hard what they’re trying to do is”.

I don’t share that sentiment, but as I’ve looked at these long timelines and seemingly slow progress, I wonder if, from an investment perspective, it’s a bit too soon to be putting money behind any one player.

What if the one I pick hits a two-year snag and in the meantime someone else comes out of the woodwork with guns blazing.

(That someone else will be Filecoin.)

Maybe that’s why the performance of these coins over the past year has been less than Stellar.

Article Prepared by Ollala Corp

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