Filecoin Investment Guide For Australians: Getting Started

Filecoin (FIL) is a decentralised storage network that allows for the storage and retrieval of data. It is a peer-to-peer network that uses blockchain technology to record transactions. Users can buy and sell FIL tokens, which are used as payment for storage services and as an economic incentive to ensure files are stored reliably. In this article, we will explore how to invest in Filecoin in Australia.

Filecoin's decentralised storage system

Filecoin is a decentralised storage system that uses blockchain technology to store data. It is a peer-to-peer network service that uses blockchain and native cryptocurrency to deliver storage services. The network is made up of a diverse range of storage providers and developers, aiming to create a robust and reliable service.

Filecoin's decentralised network is based on blockchain technology, specifically the InterPlanetary File System (IPFS). IPFS is a peer-to-peer hypermedia protocol designed to improve the limitations of using HTTP for distributed storage. All data is stored on a peer-to-peer blockchain, and users can choose miners to store their personal data and pay for this service using FIL tokens, the blockchain's native currency.

The system involves three parties: clients, storage miners, and retrieval miners. Clients pay for storing or retrieving data, placing an order on the online storage market where a deal is concluded with storage miners. Storage miners store the client’s data and are compensated. They place files in free sectors of a hard drive, and all actions are recorded on the blockchain. Retrieval miners extract data at a client's request and earn FIL by winning bids and mining fees for a particular file.

Another advantage of Filecoin's system is its cost-effectiveness. Decentralised data storage is typically based on leased excess capacity, so it tends to be inexpensive compared to traditional cloud storage services. The pricing of Filecoin is determined by an open market, where anyone can participate and offer their spare storage capacity.

How to buy Filecoin in Australia

Filecoin (FIL) is a cryptocurrency that powers the Filecoin network, a decentralised peer-to-peer file storage network. It aims to allow anyone to store, retrieve and host digital information. FIL tokens are used as payment for these services and as an economic incentive to ensure files are stored reliably over time.

Step 1: Compare crypto exchanges

The easiest way to buy Filecoin is from a cryptocurrency exchange. You can compare exchanges by looking at factors such as fees, the range of cryptos available, payment methods, customer support, user reviews, and ease of use.

Step 2: Create an account

Once you've chosen an exchange, you'll need to create an account. To do this, you'll need an email address, and some platforms may also ask for a phone number and photo ID. You may also need to verify your identity by providing a copy of a recent bank statement or utility bill.

Step 3: Deposit funds

After your account has been verified, you can deposit funds into your account. Most exchanges accept AUD deposits via bank transfer, card payment, or cryptocurrency.

Step 4: Buy Filecoin

Now you're ready to buy Filecoin! On beginner-friendly exchanges, this is as simple as entering the AUD or FIL amount you want to purchase and clicking "buy".

Step 5: Secure your Filecoin

Consider transferring your FIL to a personal crypto wallet to protect against the risks of keeping it on an exchange, such as hacks or scams. Popular options include the Ledger Nano X Wallet and the Trezor Model T Wallet.

Filecoin's native token, FIL

The Filecoin network is a decentralised peer-to-peer file storage network that allows anyone to store, retrieve, and host digital information. It is an open-source protocol supported by a blockchain that records commitments made by the network's participants. Transactions on the Filecoin network are made using FIL.

The network consists of three main parties: clients, storage miners, and retrieval miners. Clients pay for storing or retrieving data, placing orders on the online storage market. Storage miners store the client's data and are compensated with FIL. They place files in free sectors of a hard drive, and all actions are recorded on the blockchain. Retrieval miners extract data at the client's request and earn FIL by winning bids and mining fees for a particular file.

FIL can be purchased on cryptocurrency exchanges such as Swyftx and CoinSpot in Australia. These platforms allow users to deposit Australian dollars and trade for FIL. The price of FIL, like other cryptocurrencies, is determined by the forces of supply and demand in the market.

Filecoin's competitors

Filecoin has several competitors in the market, offering similar services and features. Here are some of the key competitors:

• Blockstack: A decentralised computing network and app ecosystem that gives users control over their identity and data. It empowers users to own and control their digital identity, data, and apps, ensuring privacy and security.
• Larva Labs: A creative technologist hub that has worked on a diverse range of software projects, including large-scale web infrastructure and genomics analysis software. Larva Labs provides a platform for both professional and experimental projects.
• Bancor: A blockchain protocol designed to enable liquidity for any currency. Bancor offers a seamless solution for exchanging cryptocurrencies, such as ETH to other tokens, addressing the slow transaction speed of decentralised exchanges.
• Salad: A blockchain startup that brings together the worlds of crypto and gaming. Salad simplifies the crypto mining process by eliminating the need for crypto wallets and complex PC configurations. It allows gamers to utilise their PC's computing power to earn monetary and non-monetary rewards effortlessly.
• NiceHash: A platform based on the sharing economy concept, connecting buyers and sellers of computing power globally.
• MinerGate: A mining pool created by cryptocoin enthusiasts, offering the first merged mining service, allowing users to mine different coins simultaneously without compromising hashrate.
• Dolphin: A decentralised storage platform that enables asset ownership for individuals, teams, and DAOs (decentralised autonomous organisations).
• Deupload: A decentralised cloud and IPFS (InterPlanetary File System) file manager that provides private storage and facilitates team collaboration.

Filecoin's security measures

Filecoin is a decentralised storage platform that is designed to be secure, scalable, and reliable. However, like any other blockchain-based system, it is vulnerable to security threats such as 51% attacks, Sybil attacks, and eclipses. To mitigate these risks, Filecoin has implemented several security measures:

• Encryption – Filecoin uses encryption to protect data from unauthorised access.
• Authentication – Users can authenticate themselves using public and private key cryptography.
• Authorisation – This is enforced through smart contracts.
• Auditing – Regular audits ensure that the data stored on the network is accurate and hasn't been tampered with.
• Proof of Replication – This mechanism ensures that storage providers are actually storing the files they claim to be storing.
• Proof of Space-Time – This mechanism requires storage providers to prove that they still have the file after a certain period of time.
• Redundant firewall setup – This can filter incoming traffic as well as traffic between VLANs.
• Next-generation firewall (NGFW) – This provides more robust security by incorporating an intrusion prevention system (IPS) at the network perimeter, helping to detect and prevent potential threats.
• System security – This includes a host-based firewall (UFW) and Security Enhanced Linux (SELinux), which offers the highest grade of process and user isolation on Linux.
• Privilege escalation – As the Lotus software does not require root privileges, the service account does not need privilege escalation and should not be allowed to use sudo.

In addition to these measures, Filecoin also encourages a strong security culture through secure code development and testing, working with external security specialists, and inviting security researchers to participate in its Bug Bounty program.

Frequently asked questions