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IPFS & Filecoin Network Overview

The world’s largest decentralised web3 storage infrastructure

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Agenda

Web 3.0
IPFS
Filecoin
Who
Products & Clients
Crypto Economic Model
Comparisons
Case Studies
Collaboration

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The Decentralisation of the Web

From Web 2.0 to Web 3.0

Centralized

Single points of failure�Data monetized by data monoliths

Decentralized

Distributed�Users power service�Censorship resistance

Privacy

Self-verified

Non-siloed data

Currently the web 2.0 model is centralisation by design choices:

IPv4 and IPv6
DNS
ISPs
HTTPS (Trust stores maintained by browsers)

Not only this, but several centralised platform companies have access to our data via our social media profiles and use this as the basis of their business model. This leads to several issues - the first one is a lack of ownership and portability around our own data and the second is that if any of these centralised storage systems fail entire services go down.

Now to solve this resilience engineering challenge, by introducing multiple systems and multiple layer of systems. But the domains are still centralised and way internet is designed right now, location based addressed (namely URLs) still persists this problem.

So this really leads to a question… why aren’t we designing the internet for the autonomy & resilience we need in the first place? It also leads us to the original mission of the internet - to be an open place for knowledge sharing and collaboration and for the benefit of everyone - something that it’s becoming more apparent we need to keep working towards.

So, how do we get to a world that has a resilient, performant, scalable, secure, efficient, trustlessness, censorship resistant, free and private, silo busting web?

This is exactly the kind of problems we’re working on solving at IPFS & Filecoin and why we’re so driven together with the community too.

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Web 3.0

What is it exactly?

Distributed Web�

Work offline�
Faster�
Safer�
No need for central point of coordination

Permanent Links

Blockchain�

Publicly Verifiable�
Permissionless�
Incentive alignment

Semantic Web�

Graph of Knowledge

Programmable understanding of meaning

��First is a concept of Distributed Web:

Works offline, that means you don’t always need to be connected to the main network all the time. I will explain more in the IPFS section of my speech later.
It is faster
It is safer
It should require not central point of coordination
It should give you the ability to create permanent links, so you can access it independent of the location

Second it is Blockchain empowered:

Blockchain technology helps online content to be publicly verified
It should be permionless, so anyone can join the network
It should have incentive mechanism & crypto-token economy to help with longevity & the right participation in the network

The last, but not least is, the concept of Semantics Web:

Programmable understanding of the meaning. Allow machines to understand the meaning of the objects online, this way they can be more helpful to us as they understand how they should be used and intent.
This will also allow building better knowledge graphs, because it breaks silos.

Imaging in the semantic web, the search engine understands that San Francisco is as a location and stored with a single object online and doesn’t care which website hosts information about Gold Coast. So it represents it as facts and is able to show all of the interactions you may want to have with it, such as navigate there, find flight tickets and explore the beauty of it.

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Interplanetary File System

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IPFS

Overview

IPFS stands for the InterPlanetary File System. IPFS is a decentralized storage and delivery network and data transfer protocol which builds on peer-to-peer networking and content-based addressing.

6

Peer

Unique ID

Provide services

Must be

Encrypted

Use services

"routable"

Swarm

File system

Files + Folders

Interplanetary

Distributed

(no central server)

Resilient / Offline first

IPFS stands for the InterPlanetary File System. IPFS is a decentralized storage and delivery network and data transfer protocol which builds on peer-to-peer networking and content-based addressing.

Content based:

At its core, IPFS is a versioned file system that can take files and manage them and also store them somewhere and then track versions over time. IPFS also accounts for how those files move across the network so it is also a distributed file system. It seeks to connect all computing devices with the same system of files.

In some ways, this is similar to the original aims of the Web. IPFS is actually more similar to a single bittorrent swarm exchanging git objects. IPFS could become a new major subsystem of the internet. It could complement or replace HTTP. It could complement or replace even more.

The design of IPFS breaks the traditional “centralized” design of the network. Such as referring to IP addresses or checking domains.

“When you have IPFS, you can start looking at everything else in one specific way and you realize that you can replace it all.” –Juan Benet

Who built these?

Filecoin network and community is initiated by Developer Filecoin Foundation

The problem does it solve?

Data verifiability
Data resilience & availability

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Content Addressing + Content Routing

IPFS core technology

LOCATION ADDRESSING

CONTENT ADDRESSING

Web2�IP + port

http://domain.com/�path/to/index.html

ipfs://[CID]/�path/to/index.html

IPFS�Content ID

VS

Which server does this address correspond to?

Who has

file <CID A>?

Sure, I have it if you want it

Me too!

And me! Take it!

<fileA>

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IPFS in Numbers

How is IPFS doing?

Gateway Operators

Browser Adoptions

	2019	2022
Active contributors	880	1100
95th percentile find time	40s	400ms
Browser integration	2	5
Monthly users	5M	50M
IPFS powered apps	100	1000+

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Roadmap

IPFS

Horizontally scalable, cloud native implementation of IPFS (iroh.computer) in alpha

Improvements to content exchange (eg. Car-pool)

IPFS native implementations in Mobile, gaming engines (Unreal Engine, Unity)

Native integration of IPFS into cURL, ffmpeg, browsers and more

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Ecosystem

IPFS

https://ecosystem.ipfs.tech/

https://awesome.ipfs.io/

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Largest decentralised storage network

active storage providers worldwide

3,900+

nations represented in the ecosystem

44

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Filecoin Network

What is Filecoin?

The Filecoin network enables open services for data and adds an incentive layer to IPFS. It is a global digital economy that leverages the Filecoin blockchain to operate as a settlement layer for data services, similarly to how Ethereum operates as a settlement layer for value.

Layer one, not just for storage:

Data storage
Data retrieval (Saturn)
Compute over state (FVM)
Compute over data (Bacalhau)

Key benefits:

Compatible with Web3 Protocols
Provides Verifiable data
Cryptographic proofs
Massive size, enterprise ready

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Filecoin Storage Deal

The anatomy of a

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1

* Filecoin uses the same process as IPFS so the resulting Content IDs are compatible

2

3

4

A client makes a time-limited deal (e.g., via app or smart contract) to store data

The Filecoin protocol transforms the data into a content-addressed Directed Acyclic Graph (DAG)*

Providers generate an initial Proof of Replication (PoRep) to verify they received the client’s data

That PoRep is published to the Filecoin blockchain

Over time, providers prove that they still have random subsets of client data, creating Proofs of SpaceTime (PoST) published to the blockchain

Providers are paid incrementally in FIL if they deliver the PoSTs and penalized heavily (“slashing”) if they do not

Towards the end of the storage deal, clients either renew the storage deal or let it expire

Optional: Clients renew their storage deal

Optional: Clients make a retrieval deal to retrieve their data

PoRep

PoSt

Filecoin blockchain

Storage provider’s data center

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Onboarding

The life cycle of big dataset’s

DataCap

Extraction & Pre-processing

Transformation

Deal execution

Transfer

Deal management

DataCap is allocated to clients to subsidize reliable and valuable storage

Data is extracted, encrypted, chunked or aggregated to fit into the desired sector size

Data is transformed into CAR files

Deals are made

The data is transferred, either online or offline

You must keep track of all of these files and CIDs

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Simple Data Storage Tools

Filecoin

Web3.Storage��Web3.storage allows developers to easily content address their data and get it onto distributed storage, without worrying about the reliability of their service provider or dealing with the headaches of running their own infrastructure.

NFT.Storage��A secure and reliable way to store NFTs, use NFT.Storage which preserved over 90 M NFTs.

Multichain.storage��Multichain.storage is designed for users from other blockchain ecosystems that want to use IPFS and Filecoin storage. It also gives users the option to mint NFTs in one click.

ChainSafe Storage��Chainsafe Storage is currently being used as the back end of ChainSafe Files where offers an easy to use drag and drop UI to store and own your data. Join the growing ecosystem of builders who are decentralizing their storage layer through APIs and try it for free

CO2.Storage��A web3 storage solution for environmental assets based on content addressed data schemas.

Lighthouse.storage��Lighthouse allows users to store their files on the decentralized network for lifetime at a fixed price.

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Large Data Storage Onboarding

Filecoin

Singularity��For data owners who want to onboard their data (either locally or from S3) to Filecoin with the storage providers they’ve chosen. Singularity is a CLI tool for data preparation, deal making, deal execution, and data retrieval.

Estuary��Estuary allows uploading and storing content on the Filecoin network directly from your browser. It allows anyone with public data to store and retrieve using a few API calls. Currently, the tool is invite-only.

Textile Powergate��A production-ready Filecoin deployment stack.Ensure storing data on Filecoin is easily available on the IPFS network.

AcroTransfer

Lyve Mobile Array

Transport Tools

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Data Onboarding Programs

Filecoin

Filecoin Plus��A social layer mechanism that incentivizes all participants to make Filecoin more useful. Get started by applying to DataCap.

Slingshot��A social layer mechanism that incentivizes all participants to make Filecoin more useful. Get started by applying to DataCap.

BigData Exchange��A social layer mechanism that incentivizes all participants to make Filecoin more useful. Get started by applying to DataCap.

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Network Growth

How’s Filecoin going?

Storage Network

	2021	2022
Storage capacity	1.69+EiB	17+EiB
Storage providers	856	4000+
Pledged collateral	2.68M	134M
Orgs built on Filecoin	295	570

Storage Size

	2021	2022
Unique Content ID	372k	6.1m
Unique Providers	545	1136
Storage Deals	699k	1.83m
Total Data Stored	24 PiB	461PiB

* Source Filecoin 2022 Review

The data services Filecoin looks to enable include, but are not limited to, storage, retrieval, and computation over data. The ultimate goal is to enable the composable integration of these services in order to build a decentralized infrastructure that can credibly subsume the current centralized cloud.

Filecoinʼs export economy is most easily understood by considering the metaphor of an island economy producing valuable goods and services from raw materials. Trades are executed in the islandʼs currency (FIL), which must be purchased to make trades. Inhabitants of the island participating in trade need to deploy capital in this currency to engage in productive activities; typically this deployment is investment in capital assets, while in the case of Filecoin, this takes the form of storage provider hardware and collateralized tokens.

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Protocol Revenue

How well is it going?

Filecoin collects its revenue from both supply side and demand side of the crypto economy. ��In 2021, Filecoin yielded $14m protocol revenue. Over lifetime, it has cumulative obtain $1.6b.

Making Filecoin the most profitable chain after Ethereum. �

Protocol Revenue:

Base fees: these are paid for any storage deal or proof. These fees vary based on message congestion on Filecoin.
Batch fees: these are paid for adding storage capacity.
Overestimation fees: these are paid for optimizing gas usage.
Penalty fees: the network collects penalty fees from those who fail to provide storage as promised.

Filecoin $1.6b

Ethereum $8.8b

The data services Filecoin looks to enable include, but are not limited to, storage, retrieval, and computation over data. The ultimate goal is to enable the composable integration of these services in order to build a decentralized infrastructure that can credibly subsume the current centralized cloud.

Filecoinʼs export economy is most easily understood by considering the metaphor of an island economy producing valuable goods and services from raw materials. Trades are executed in the islandʼs currency (FIL), which must be purchased to make trades. Inhabitants of the island participating in trade need to deploy capital in this currency to engage in productive activities; typically this deployment is investment in capital assets, while in the case of Filecoin, this takes the form of storage provider hardware and collateralized tokens.

Filecoin’s revenue consists of the following:

Base fees: these are paid for any storage deal or proof. These fees vary based on message congestion on Filecoin.

Batch fees: these are paid for adding storage capacity.

Overestimation fees: these are paid for optimizing gas usage.

Penalty fees: the network collects penalty fees from those who fail to provide storage as promised.��HyperDrive network upgrade was implemented in June 2021. The upgrade led to a 10-25x increase in network capacity, which has resulted in reduced congestion on the network.

While this is good for users, the upgrade reduced transaction fees, which drastically cut revenue in the subsequent quarters. (On the other hand, generating revenue through congestion is not a great business model.)

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Ecosystem

Filecoin

With over 500+ startups building and growing in the IPFS, Filecoin & PL ecosystems

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Filecoin ❤ IPFS

The perfect complements

IPFS for fast, flexible retrieval (gateways, local nodes, browsers)

Filecoin for persistence and verifiability

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The Organizations

Who are you speaking to?

Protocol Labs is an open-source R&D lab building protocols, tools, and services to improve the internet

FF is the steward of the Filecoin community, aspiring to put the power of humanity’s most important information back into the hands of everyone.

80+ full time contributors + many more orgs that engage in WG’s

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Initial Coin Offering

First, the raise

Raised $257M+ in over a month from 2100+ investors in 2017. (Cointlist)

A notable ICO because:

First SEC-compliant ICO
SAFT agreement (security)
swamped the CoinList website
Lead by institutions:

Sequoia Capital
Andreessen Horowitz
Winklevoss Capital
Union Square Ventures
FBG Capital
LongHash Ventures
The Arc Fund
Bollinger�

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Crypto-economics

What is the business model?

An Island Economy

Encourage amass HW
FIL are utility tokens
⨎2 billion, ⨎330M minted each year

(6 year half-life, 97% over 30 years)

Block rewards

(Simple minting + Baseline minting)

Concepts:

Vesting (6, 12, 24, 36 months)
Mining Reserve
Storage Providing + Consensus Providing
Deals & Sectors
Filecoin Plus
Collateral & Slashing

For details, see A Primer to Filecoin Circulating Supply & Engineering Filecoin’s economy

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Filecoin Reports

Want to learn more?

Filecoin Annual Report

Messari State of Filecoin

CoinGecko The State of Decentralized Storage

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FVM

Compute over State��Gives programmability on chain�

�

Retrieval.Market�Decentralised CDN��Saturn network &

Titan network�

�

Bacalhau�Compute over Data

Allows compute intensive processes run on storage nodes��

Next Steps

IPFS & Filecoin

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FVM

Compute Over State

The Filecoin Virtual Machine is a runtime environment for smart contracts (also called actors) on the Filecoin network. FVM brings user programmability to Filecoin, unleashing the enormous potential of an open data economy.

https://fvm.filecoin.io/

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FVM

Compute Over State

https://github.com/filecoin-project/ref-fvm

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�The Filecoin Retrieval Market enables a dCDN to emerge around the Filecoin Network.

Retrieval.Market

dCDN

Retrieval Market�https://retrieval.mareket

Saturn Network�https://strn.network/

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Bacalhau is a platform for fast, cost efficient, and secure computation by running jobs where the data is generated and stored. With Bacalhau you can streamline your exisiting workflows without the need of extensive rewriting by running arbitrary Docker containers and WebAssembly (wasm) images as tasks.

Bacalhau

Compute over Data 🐟

Bacalhau�https://www.bacalhau.org/

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Compared to others

Filecoin

* The State of Decentralized Storage - CoinGecko


Cost
Capacity/ HW
Usage
Market Cap
Nodes

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Collaboration Opportunities

Filecoin

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Dev Infrastructure

Collaborate with Filecoin on…

Infrastructure requirements:

Filecoin uses Enterprise grade equipments (unlike ASIC mining)
HW investment ~$2.5b+ (big base)
3700+ active Filecoin nodes
10k active IPFS nodes
Not a PoW chain, env friendly
Certain processes, e.g. sealing, is resource intensive

In need of:

More JSON RPC endpoints
Hosted IPFS & Filecoin node solutions
IPFS Gateways & Clusters

Glif Node

Infura Nodes

Chainstack RPC

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Client Onboarding

Collaborate with Filecoin on…

Current state:

Over 400PiB stored in 2022
20% increase
Strategic focus in 2023 is onboarding
Total verified clients 1247

In need of:

More FIL+ clients
Actual paid storage clients
Client onboarding tooling
Client onboarding professional services

SEAL Storage + Atlas is storing CERN data on Filecoin

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Web3 Strategies

Collaborate with Filecoin on…

Filecoin is a trusted brand in Web3:

Largest distributed network
Lots of hardware investment and collateral staking (ensure QoS)
Sustainable economics model
Likely to persist data for longer

Web Summit 2022, Lisbon, Portugal

CNBC + Filecoin Sanctuary, Davos 2023

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Developer Engagement

Collaborate with Filecoin on…

Filecoin is made for builders:

Hackathons

70+ hackathons
7k+ developer engaged
1300+ project submissions
~$1m prize

Dev Grants

700 Grants approved
$13m Pledged

Accelerators

Work with 15+ VCs
500+ teams received funding

Fil Bangalore Event in Dec 2022

Fil Singapore, Sep 2022

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Technical Integration

Collaborate with Filecoin on…

Using it raw:

Drand
Libp2p
IPLD, Multiformat, IPNS
FVM, Bacalhau etc…

Implement Storage Integration:

IPFS integration
Filecoin integration

Deeper protocol level integration:

Using FVM
Integration with nodes (Lotus, Venus, Forest)

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Filecoin Community

Follow us, join

Join the community:

Discord & Slack
Ambassador program

Chat with us:

Developer Advocate office hours
Gathertown weekly

Stay informed:

YouTube https://bit.ly/36XGYGO
Newsletters ipfs.io, filecoin.io
Twitter @ipfs @filecoin
Hackathons page

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Book me or DM me!

Jenks Guo�Developer Advocate�Filecoin Foundation�Twitter: @jenksguo