What is Siacoin?
Siacoin or SC is the utility token native to the Sia platform. The latter is a completely decentralized project powered by blockchain technologies. Sia serves as a cloud storage provider. To put it simply, it’s a blockchain-based alternative to centralized storage providers such as iCloud, Google Drive, and Dropbox.
The main selling point of Siacoin is that it allows users to lend their spare storage space and earn crypto rewards. On the other hand, users who need storage space can borrow it with Siacoin tokens.
Besides SC, the Siacoin network is powered by another native token - SiaFunds or SF. It’s a revenue-sharing that provides holders with a share of transaction fees paid out in SC whenever there’s an upload. There is a max cap of 10,000 SF tokens.
You can obtain Siacoins by mining or purchasing them on a centralized or decentralized exchange platform.
There is no pre-determined total supply of Siacoin tokens. Instead, the project implements an unlimited token supply model. All Siacoins are mined using the Proof-of-Work (PoW) consensus mechanism.
According to the Siacoin whitepaper, its official currency is high in volatility, especially at the starting stages of the project. This means that the Siacoin price often changes in great amounts.
Due to high volatility, users who provide storage are advised to increase the price of their storage space to hedge the effects of volatility.
You can have a more thorough look at the Siacoin price history and the current Siacoin price in the graph above.
What are the Main Features of Siacoin?
As discussed in the What is Siacoin section, we’ve established that Siacoin is a blockchain-based cloud storage provider. It’s an open-source project which means that anyone can make contributions.
There are 2 roles within the Siacoin network:
- Renters pay a fee to hosts so they can upload their data on the Sia network;
- Hosts provide storage space and collect fees. They control the price for renting out storage space, contract fees, collateral amount, and bandwidth price.
For a fee, users can store their data in rented cloud storage. This data is encrypted into 30 segments on the Sia blockchain. These segments are hosted by different storage providers.
A smart contract is created between a renter and a host whenever a renter uploads data to the host’s storage space. It determines the amount of data, time period, and fee for the hosting period.
Both renters and hosts lock up a set amount of Siacoins in the smart contract in the form of collateral during the entire hosting period. Renters are responsible for covering the network fees which include contract formation fees and bandwidth fees.
After the set time period passes, the smart contract checks whether the host has kept their end of the bargain. If the uploaded data is available, they receive their payment plus collateral deposit. However, in case the host lost the data by being offline or due to another reason, they lose their deposit and don’t receive payment.
One of the main goals of the Siacoin crypto project is to become a major player in the cloud storage market.
Who Developed Siacoin?
The idea behind the Siacoin crypto project was born in 2013 by two computer science students David Vorick and Luke Champine. It was announced in May 2014, however, due to unknown reasons, the project was canceled and re-announced the next year and launched in June 2015.
Both David Vorick and Luke Champine successfully completed their undergraduate studies at the Rensselaer Polytechnic Institute. Prior to the launch of Siacoin, the duo co-founded Nebulous which was divided into Skynet Labs and the Sia Foundation in 2021. Nebulous played a significant role in the development of Siacoin.
Skynet Labs has built several products on the Siacoin network such as SiaStream and the Skynet network.
The core team of Siacoin consists of individuals based in the United States and the European Union.
There have been several significant investments put into the Siacoin project. This includes a seed round investment of 750,000 US Dollars from Xiaolai Li and Procyon Venture. Bessemer Venture, Dragonfly Capital, and other investors participated in a pre-Series A round and raised 3,500,000 US Dollars.
Don't forget to check out the current Siacoin price on the graph above if you're considering purchasing this cryptocurrency.
