SiaCoin: Death Of The Data Center? Introducing Your DECENTRALIZED Private Cloud

On September 25th, 2017, SiaCoin had a market cap at USD $142,762,956 for the equivalent of 36,143 BTC or 482, 830 ETH with a circulating supply of 29,628,705,884 SC at a price of $0.004818 per coin. SiaCoin hits the lists at cryptocurrency #42 by market cap today.

A friend of mine recently requested a profile on SiaCoin, and I’m happy to oblige! As I said recently, “The more I know, the more I know the less I know.”

Let’s dig into the SiaCoin website, whitepaper, and other relevant content in compiling this crypto “cliff notes”.

“Welcome to a new era of cloud storage on the blockchain.”

  • Sia is a cloud storage platform like Google Drive, Dropbox, and Amazon Cloud.
  • Sia is a decentralized cloud where data is stored on the blockchain.
  • The idea of Sia was originally conceived at HackMIT 2013. What if you could liberate the unused storage space of the world and unite it into a worldwide free market for data?
  • Sia leverages the capacity of blockchain technology to enable distributed networks to reach consensus in a secure and trustless way. Cryptographically secured smart contracts ensure the encryption and transfer of data with no possibility for a third party to interfere in any way.
  • Sia is a new approach to cloud storage platforms. Instead of all datacenters being owned and operated by a single company, Sia opens the floodgates and allows anyone to make money by renting out their hard drive.
  • The promise of Sia is a decentralized network of datacenters that, taken together, comprise the world’s fastest, cheapest, and most secure cloud storage platform.
  • The long term goal of Sia is to be the backbone storage layer of the Internet.
  • “We believe data should be free. We aim to liberate the unused bits of the world and construct the largest storage superserver on the planet.”
  • Sia eradicates the need of trusting centralized data centers.
  • The idea behind Sia is that instead of everything being essentially hosted on central servers, Sia’s blockchain technology will decentralize file storage and make it open-source. Sia will then allow companies to get involved and host their own private decentralized cloud and sell that as a service to their customers.
  • Sia essentially provides the platform that will have users paying for storage and providers running their own private decentralized cloud.
  • Sia: “hosting of the future.”
  • At the end of the day, this is only the beginning for companies like Sia. The disruption to the tech world has only just begun, and the sky is truly the limit. Is blockchain tech reinventing the way the internet works and the world communicates? Will Dropbox and Amazon S3 soon be outdated, overpriced, and obsolete? Time will tell.
  • Sia splits apart, encrypts, and distributes your files across a decentralized network. Since you hold the keys, you own your data. No outside company can access or control your files, unlike traditional cloud storage providers.
  • Sia’s decentralized cloud is on average 10x less expensive than current cloud storage providers. Storing 1TB on Sia costs about $2 per month, compared with $23 on Amazon S3. Unlike Dropbox, Sia is metered, which means you only pay for what you use. 100 GB costs $0.20 per month, and 1100 GB costs $2.20 per month, etc.
  • Sia stores tiny pieces of your files on dozens of nodes across the globe. This eliminates any single point of failure and ensures highest possible uptime, on par with other cloud storage providers.
  • Sia is completely open-source. Over a dozen individuals have contributed to Sia’s software, and there is an active community building innovative applications on top of the Sia API.
  • Geographic diversity: When data is uploaded to Sia, it is uploaded all around the world. Outages due to DDoS attacks in North America don’t affect the data, because it’s also replicated in four other continents across a large number of nodes.
  • Sia makes the most sense for write-seldom, read-often data.
  • Here are some examples of things that work very well for Sia:
    • Computer snapshots.
    • A media center.
    • Research Data Warehouse.
    • Life recorder.
    • Web archive.
    • FUSE.
    • Blockchain database.
  • Using the Sia blockchain, Sia creates a decentralized storage marketplace in which hosts compete for your business – this leads to the lowest possible prices. Renters pay using Siacoin, which can also be mined and traded.
  • Anyone can rent out extra space on their PC to the Sia decentralized network and get paid in Siacoin. Similarly, any user who wants to use Sia storage needs to pay Siacoins to a host.
  • Sia uses a custom blockchain designed specifically for facilitating payments and file contracts.
  • “There are a few important reasons for having our own cryptocurrency and our own blockchain”:
    • It gives us control over our own destiny. The last thing we want is to run an enterprise-grade storage network on a technology that we do not control. If Bitcoin or Ethereum have network congestion, or if Ethereum forks off, or if some new vulnerability is discovered, we don’t want to be affected, or subjugated to another party’s roadmap.
    • It helps align incentives across our decentralized network. Miners get rewarded in Siacoin for securing the blockchain, hosts receive Siacoin for selling storage space, renters pay in Siacoin to buy storage space.
    • It allows us to create smart contracts built specifically for file storage. A Siacoin can do 2 things – it can be transferred from one user to another, or put into a file storage contract on the network.
  • “Maybe if we were starting Sia in 10 years, when Ethereum or another tech was mature and stable and very secure, we could have built Sia on top of it. But for now, our own crypto and our own blockchain is required.”
  • “We are not trying to build something that may work in 10 years – we have already built a working decentralized storage network that is secured by Proof of Work.”
  • Choosing ASICs for Sia:
    • “We recently announced that we would be manufacturing and selling ASICs for Sia, an announcement that received a lot more heat and controversy than I was expecting. People primarily seemed to be concerned with mining centralization, and what happens if a small number of groups end up controlling all the hashrate — groups that may well include the developers, as the developers are the ones making the chips.”
    • “The choice for ASICs is distasteful, because the disadvantages are more visible vs. other choices we could make, but I strongly believe that ASICs are far and away the best long term decision.”
    • “Proof of Work is a very impressive system, and it’s impressive in spite of all the miner centralization that plagues it. If you want true decentralization and trustlessness, it is the only solution that has stood the test of time.”
  • Running Nextcloud with Sia requires running a full Sia node. For Nextcloud users, the Sia/Nextcloud integration provides a unique way to expand their storage through an encrypted, distributed, redundant and global storage technology.
  • The Sia protocol largely resembles Bitcoin.
  • Sia’s primary departure from Bitcoin lies in its transactions: Bitcoin uses a scripting system to enable a range of transaction types, such as pay-to-public-key hash and pay-to-script-hash. Sia opts instead to use an M–of–N multi-signature scheme for all transactions, eschewing the scripting system entirely.
  • Sia’s M–of–N multi-signature transaction scheme reduces complexity and attack surface.
  • Sia extends transactions to enable the creation and enforcement of storage contracts. Three extensions are used to accomplish this: contracts, proofs, and contract updates.
  • There are inefficiencies within the Sia incentive scheme: The primary goal of Sia is to provide a blockchain that enforces storage contracts. The mining reward, however, is only indirectly linked to the total value of contracts being created.
  • “We believe Sia will provide a fertile platform for decentralized cloud storage in trustless environments.”
  • The Twitter handle for SiaCoin is: @SiaTechHQ
  • Sia is backed by Nebulous Inc. (headquartered in Boston, USA).
  • The primary markets for SiaCoin are:
    • Bittrex (currency pair SC/BTC)
    • Poloniex (currency pair SC/BTC)
  • Sia founders are David Vorick and Luke Champine.
  • SiaCoin consensus method: Proof of work.
  • SiaCoin uses algorithm BLAKE-256.
  • Blocks are produced every ten minutes with SiaCoin.
  • SiaCoin uses GPU mining.
  • Market cap history:
    • August 31st, 2015: SiaCoin market cap starts at $148,857.
    • February 15th, 2016: SiaCoin market cap hits $1,105,160.
    • June 17th, 2016: SiaCoin market cap reaches $12,792,800.
    • May 1st, 2017: SiaCoin finally passes market cap $25,000,000 by exploding all the way to $31,637,600.
    • May 6th, 2017: SiaCoin market cap reaches $53,113,900.
    • May 18th, 2017: SiaCoin market cap reaches $106,631,000.
    • May 21st, 2017: SiaCoin market cap reaches $225,975,000.
    • June 20th, 2017: SiaCoin market cap reaches $527,770,000.
    • Since then, SiaCoin has been languishing and/or weakening at a time when other coins are quickly rebounding from China woes.
  • Resources:

“The long-term goal of Sia is to be the backbone storage layer of the Internet. We believe data should be free. We aim to liberate the unused bits of the world and construct the largest storage super server on the planet.”

Thanks for reading!

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