I have been learning about cryptocurrencies for more than half a year now. I wrote about my first investments in cloud mining right here: All You Need To Know About Bitcoin. I invested in Bitcoin, Litecoin, Ethereum and Dash mining and I'm also planning to add Monero and Zcash mining contracts to my portfolio.
Even though all these big cryptocurrencies are rising and are really great investments, currently it is summer and not a lot of moves are happening so, I started doing a bit of research on the up and coming cryptocurrencies. Mostly about the ones that are around rank 10 to 30 and in this post I want to summarize my findings about a cryptocurrency that caught my attention, which is Siacoin.
What Is Siacoin?
Siacoin brings the blockchain technology into the cloud storage space. Instead of building massive servers that cost a lot of money to maintain, they are actually building a network of people that anyone can join and lend out their free space to others and make some money.
It sounds quite genius if you ask me. We all have free space on our computers that we could lend and the blockchain technology allows to store the data securely, but let's dig a little bit deeper.
The Competition
The cloud storage space is very competitive. We all know Dropbox, Google Drive, One Drive(Microsoft) and these are only the big players as there are a bunch smaller ones and there are even companies like Storj using the same blockchain technology. Some say it's now a better investment because the price hasn't gone up significantly.
So, the competition is fierce and gaining users won't be easy though from what I read Sia targets big companies instead of regular users and it makes perfect sense having in mind that it's still inconvenient to use regular blockchain technologies.
The Inner Workings
So, if you wanted to make a little bit of money renting out your storage space to Sia, what would you need to do?
Firstly, you would need to buy 2000 Siacoins minimum, at the current price it would be around $40. This is the major factor that makes the price of the coin go up because you have to hold the coins if you want to rent out your space. Now, the amount of coins you need to hold I think depends on the amount of space you want to rent out.
Also, it's not that easy to set everything up. You can't just click a button or two and rent out space from your laptop, there's some decent configuration involved and you also need to ensure near 100% uptime. I won't get into exact details here because if you are interested in that you will still need to find a more in-depth guide.
All I want to say is that the system is complicated and it's far from mainstream adoption. Also, the necessity to hold coins even though is good for the token price is still a barrier for wider adoption.
Potential
Nonetheless, there are currently more than 1.1 petabytes of storage available on the Sia network from which only 2% is currently being used. So, there are a lot of people renting space, but not that many renting it out and the opportunity for the average folk isn't that great right now.
Though on the broader perspective, if Sia would manage to get at least a single big company on board that available space would quickly disappear, which would mean a higher demand for space, then the price of the Siacoin would skyrocket, because more people would be buying coins to be able to rent out their space.
When and will that happen? Who knows. You can only guess, but in my opinion, it's likely to happen because Sia is able to offer 10 times cheaper storage.
To put things in perspective, Dropbox is estimated to be worth around $3.5 billion. Where Sia currently has a market cap of a little more than $500 million. So, it's already quite big in comparison and I would even say it's rather inflated having in mind that the adoption rate and from a different perspective there's also a lot of room for growth if Sia would grow as big as Dropbox.
Wrapping It Up
So, in my opinion, the price of the Siacoin is a bit inflated for its current usability rate, but I do believe in this idea of decentralized cloud storage, it's safer for the users and 10 times cheaper, which is the ultimate selling point.
My plan is to buy at least 2000 Siacoins that I could use in the future to try out renting out my storage space.
What do you think about Sia? Have you bought Siacoins? Let me know in the comments below.
Congrats on a nice post. Am actually with siacoin right now and following them keenly with ripple. I believe in a decentralised storage. Hope the demand will rise soon when there is a major hack
Thank you. Yes, Ripple is good as well, it's one of those rare cryptocurrencies that already has some market adoption.
at the moment, there is no demand for storage.
Sadly, but yes. Hopefully, they will grow quickly and that will change :)
Nice blog. Interesting to see I'm not the only one that is thinking about this. Not sure if I believe in the current crypto investment climate but I do believe in the blockchain. We really need more insights in the market and previous investment results. Besides coinmarketcap.com there is: https://www.coincheckup.com They give great insights in the team, the product, advisors, community, the business and the business model and other techincal insights. Check: https://www.coincheckup.com/coins/Siacoin#analysis To watch Siacoin Analysis
Nice website, will need to check it out.
When will the price of Siacoin go up! it is in a down trend.. :(
Have no idea, I'm guessing people are changing their Sia coins for Storj, if you would like at the charts Storj got a 300% increase and is not that far away from Sia...
Wow man really good post
Thanks :)
Can you suggest a good wallet for siacoin
SIA makes on here http://sia.tech/apps/
Well, I'm using their local wallet, because I was interested in also mining it, it took a long time to synchronize. The alternatives would be to keep them at an exchange like Poloniex, but it's not safe. A lite version of the wallet hasn't come out yet.
Downloading the entire thing is a hassle. Waiting for a Lite client
Yeah, it definitely is :/
☺️👍
Thanks for the good article and explanation, provided me with more information.
Glad you liked it :)
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Nice post man. I have 5000 coins right now and am considering buying some more as the price today is quite low. Just wanted to do some reading before I jumped back in though.
I hold a similar amount of SIA right now :))
Very informative article.
Now you get 2000 Siacoins for about $8. Will it go down even further?
I have 4000 Sia coins.