Filecoin economic model and mainstream cryptocurrency exchange ZB.com’s Filecoin computing power leasing product analysis

On November 8, ZB.com officially launched the Zillion pool Filecoin full-packaged computing power leasing product, and launched the first phase of computing power subscription activity. The event was welcomed by many users, and the subscription of 3000T computing power was completed on November 11. November 15 was the first day that Zillion pool issued revenue. As some users did not understand Filecoin’s economic model, they found that the amount they received did not match theirs expectations. So today we will share Filecoin’s economic model and the advantages of Zillion pool Filecoin computing power leasing product.

First, let’s talk about the threshold of Filecoin mining. Filecoin miners are completely different from IPFS miners. IPFS mining machines rely on high-quality storage services to mine. Whoever can store more data will be able to mine more. The key to competition lies in storage capacity. Filecoin mining machines rely on computing power competition. Whoever has strong computing power will earn more. The key to competition is computing power. Therefore, the difficulty of Filecoin mining has increased a lot, and the requirements for software, operation and maintenance, and computer room are very high. The mining machine is an expensive high-performance server, and the cost is much higher than that of the IPFS mining machine.

The price of a 96T mining machine is about 14K dollars. According to the current Filecoin price (about 30 US dollars), the net payback period is 7 to 8 months.

If you want to achieve the highest mining speed, a 96T mining machine needs about 75–90 days to complete the packaging (under the prerequisite of sufficient pledged coins). Before full package, the computing power will continue to increase until it reaches the highest computing power. Moreover, miners also need to pay 20% of operation and maintenance costs to mining machine merchant. Therefore, if an ordinary user chooses to buy a mining machine for mining, the cost to be borne includes: a 14K dollars 96T mining machine + mining machine packaging period + pledged FIL tokens.

The full-packaged Filecoin computing power leasing product provided by Zillion pool allows users to participate in Filecoin mining without the cost of mining machines, pledge, and waiting for the 90-day packaging period. Apart from the technical requirements, these are the costs of keeping ordinary users out of Filecoin mining. After subscribing to Zillion pool Filecoin computing power, users only need to wait for the income. More so, Zillion pool remove the necessary 20% operation and maintenance costs and will not deduct any income from users.

Filecoin economic model

Next, let’s talk about the Filecoin economic model that everyone cares about most and the rules of Zillion pool Filecoin mining income distribution. In the previous news flash released by ZB.com, “According to the current Filecoin mining income which is about 0.21FIL/T per day, the estimated static income of 1T in one year is 0.21*365*80%=61FIL. The income will be distributed daily according to Filecoin’s official release rules. “ Many users thought that the revenue per T per day is 0.21T*80%=0.168FIL. In fact, this is not right, because the release of the coins needs to follow the official release rules of Filecoin, and even Zillion pool.

Compared with the economic models of well-known public chains such as Bitcoin and Ethereum, Filecoin’s economic model is most special in that it introduces two mechanisms, which are “pre-pledge” and “180-linear release”. In other words, if Filecoin miners want to obtain FIL tokens through mining, they need to pledge a certain amount of FIL tokens to the official designated wallet address in advance before they can mine; The mining income obtained also needs to be linear-released after 180 days.

According to Filecoin official rules, a mining node that packages a sector (32GB, 1T=1000GB), needs 0.19 FIL tokens as pre-pledge (the current number of FIL pledges shows a slight upward trend every day). And every package of 1T of storage space (1024GB) requires 6.08 FIL as pre-pledge and the period is 540 days. Due to the large number of coins that need to be pledged and the long period, Filecoin miners were once unsatisfied and challenged the official due.

According to the current data of Filecoin block browsers, the average output of FIL tokens on the entire network is 0.21 /T/day, of which only 25% are released immediately, and the remaining 75% are linear-released after 180 days. This release rule is the result that the Filecoin official gave in to the miners. The rule was 100% of the revenue should be linear-released after 180 days.

So, if a user purchases 1T of Filecoin provided by the Zillion pool, what is the actual income of the user?

Assuming that the current mining speed is 0.21FIL/T, the daily static income of 1T would be 0.21FIL. And only 25% will be released to users’ account immediately, that is, the actual income received is 0.21FIL*25%=0.0525FIL. The remaining 75% shall be linear-released in the following 180 days.

On the second day, the actual income received by the user would be: 0.0525FIL+0.0525FIL*75%*1/180≈0.0527FIL. As time increases, the daily actual income of users will also increase, because there is a 180 linear release of the previous 75% of the income. Therefore, after purchasing 1T of computing power for one year, the actual cycle of receiving all the income is 1 year + 180 days. I believe this addition is easy to understand for our users.

Some users may be wondering, the actual income I received everyday is not the above figure? ZB.com need to remind here that the daily mining speed fluctuates. You can go to the Filecoin block browsers to check. Here is an example browser address: https://filfox.info/en/.

Filecoin’s future value

This complicated rules of investment income obviously makes some speculators and major mining machine manufacturers unsatisfied. For investors, does this mean that Filecoin has no investment value? Will it be the same as EOS? In fact, this is not the case. On the contrary, the official who formally set up such a complicated economic model is the one who cares about the long-term value of Filecoin. If a simple mining mechanism is set up from the early stage, even without a threshold, it will only overdraft the project’s own expected value and future potential. The price of BTC was extremely low ten years ago, and “3000BTC for a pizza” is a true story. Only the real valuable projects are worth waiting for.

For the current Filecoin economic model, we should understand it with a more tolerant mind. After all, the Filecoin official really wants to make decentralized data storage practical. This is a continuous and great undertaking, and it is also a low-risk game for long-termists.

Reminder:

Zillion Pool phase 4 Filecoin Computing Power will be launched at 16:00 (UTC+8) today and you can subscribe on ZB Zapp-Filecoin Cloud Hashrate page.

About ZB Group

ZB Group was founded in 2012 with the goal of providing leadership to the blockchain development space and today manages a network that includes digital assets exchanges, wallets, capital ventures, research institutes, and media. The Group’s flagship platform is ZB.com, the industry leading digital asset exchange. The platform launched in early 2013 and boasts one of the world’s largest trading communities.

ZB Group also includes ZBG the innovative crypto trading platform, and BW.com, the world’s first mining-pool based exchange. Other holdings include wallet leader BitBank.

Industry intelligence and standards are headed by the recently launched ZB Nexus who embody the core values of ZB Group and open-source their reports and analysis for the public.

Learn more about ZB Exchange by visiting www.zb.com.