What is Siacoin(SC)? – A Detailed Guide

Smart devices have become a crucial part of daily life. These devices generate a huge amount of data every day. And centralized organizations are using that data to their advantage. The problem is that the users don’t have any choice but to give up their data to use a particular company’s product.

But the blockchain industry is offering a reasonable alternative to traditional data storage. Blockchain networks enable users to store their data in a decentralized environment. Siacoin(SC) is one of the leading projects in this category dedicated to ensuring the user’s privacy.

What is Siacoin?

Sia is an Ethereum-based project dedicated to providing decentralized cloud storage services with reasonable fees. Centralized cloud storage services like Amazon and Google can use the data for marketing efforts. But the Sia network is designed to dethrone these giants by putting decentralized cloud storage solutions on the pedestal.

SiaStream is the most important service of the network that allows users to stream media in a decentralized environment. Skynet is the second most important tool designed to deliver the pillar content to the users.

Siacoin Important Features

Privacy

The Cambridge Analytica scandal is a worrisome example for those who are seriously concerned about their data. The scandal revealed that Cambridge Analytica Ltd, a British political consulting firm, purchased the users’ privately stored data from Facebook. And it all happened because a centralized organization had complete control of the data.

But that’s not the case with the Sia network. Sia network ensures data privacy by breaking it down and encrypting it individually. The data is stored on global systems where even the hosts can’t access it. The users can only access their data by submitting private keys. Thus, users don’t need to worry about data breaches.

Security

The major problem with centralized data storage systems is that they’re always vulnerable to data theft. A person or a group of people can easily steal their desired information once they’ve got ahold of the data centers of a centralized organization. Although it seems impossible with the big giants like Google or Amazon, the risk of stealth is always there.

Therefore, the users need to choose a decentralized solution that is free from all such threats. Even if a hacker managed to access a host’s computing infrastructure, he won’t be able to extract a user’s data.

Affordability

Traditional cloud storage services like Amazon, Google, and Microsoft charge a hefty amount of money for storing data. And the charges increase depending on the amount of data stored. On average, these networks charge around $20 to $24 monthly fees for storing data. On the other hand, the Sia network charges only $2 per month for storing 1TB of data.

Similarly, the Sia network offers extremely cheap bandwidth compared to these networks.

Siacoin Brief History

Siacoin was introduced by Luke Champine and David Vorick in 2013. The name Sia refers to an ancient Egyptian god of perception. They both studied computer science at the Rensselaer Polytechnic Institute. Vorick attended a hackathon at MIT in 2013 where he got the idea of developing a decentralized file storage network. Vorick also contributed to Bitcoin Core.

They both raised around $750,000 in funding for the project. Procyon Ventures and XiaoLai Li are the early investors that supported this project. The beta version of the project was introduced in March 2015 and the final version was launched in June of that year. Over the years, the Sia team has raised around $6.4 million for the network’s growth.

The project is supported by renowned investors including Fenbushi Capital, First Star Ventures, Raptor Group, and INBlockchain.

How Does Siacoin Work?

Siacoin has established a network of Hosts who can lend their hard drive space to Renters who are willing to store their valuable data in a decentralized environment. The network avoids the single point of failure by breaking the files into 30 pieces once a user has uploaded the data.

These pieces are then encrypted individually. Sia network uses erasure coding technology to immediately transfer the files to the renter upon request even if 60% of the hosts are offline. The platform has introduced file contracts (smart contracts) to ensure that the hosts and renters consistently comply with the terms of the agreement.

The contracts have a 90-day duration. Once the duration ends, the network asks the host to provide storage proof to prove that he has successfully stored the renter’s data during this time. The SC tokens from the smart contract are transferred to the host once the proof is added to the blockchain.

Sia Blockchain

Sia Blockchain scatters the data among different nodes to protect it from malicious actors. Even if a node operator manages to access the user’s private key, he’ll only be able to access a fraction of the data stored. The network monitor’s the host’s uptime and asks for proof of storage to avoid the would-be malicious hosts.

Siafunds

Sia network has introduced Siafunds to encourage more users to participate. Once a smart contract is completed, the platform transfers 3.9% of each funding source to these contributors. The value of Siafunds is determined by the size of active contracts and the quantity of the tokens.

Siacoin Tokenomics

SC is the native token of Siacoin that is used to pay storage fees within the network. With a circulating supply of 54 billion tokens, SC has a market cap of $185.7 million. It ranks among the 200 best cryptocurrencies in terms of market cap. SC has an unlimited supply because it’s a utility token that can be used for multiple purposes. However, it can cause inflationary problems in the long run.

Conclusion

Siacoin is a decentralized cloud storage solution dedicated to protecting users’ data from hacking attacks. The platform charges only $2 per month for storing 1TB of data. The users can store their valuable data only on global computers to avoid cyber attacks. The network breaks data into three pieces to protect it from malicious hosts.

If you need more information about how Siacoin works, feel free to get in touch with us. We also invite you to subscribe to our weekly newsletter if you need regular updates about Bitcoin and the crypto market.