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    Crypto Chain Post
    Home » Storage Miners

    Storage Miners

    News RoomBy News RoomDecember 30, 2022No Comments2 Mins Read

    Storage miners are cryptocurrency miners who rely on offering sufficient storage space for nodes to reach consensus and validate transactions.

    Mining in the cryptocurrency world is one of the most important processes. Depending on the consensus mechanism a blockchain utilizes, there are different types of mining. Storage mining is one of the numerous types of cryptocurrency mining.

    Storage mining is a type of cryptocurrency mining that allows miners to receive rewards for storing data on their personal servers or devices. One of the main concepts of storage mining is that miners have to dedicate a certain amount of storage space to become eligible to be a node of the blockchain network.

    One of the most notable cryptocurrencies that depends on storage mining in its operations is Filecoin. The Filecoin blockchain relies on the storage capacity of its miners in order to select eligible nodes. These nodes then serve as transaction verifiers and miners of new blocks which are added to the chain. 
    Entrusting the node-selection process to a storage-based consensus mechanism is somewhat experimental in the cryptocurrency industry. Most popular blockchains rely on either proof-of-work (PoW) or proof-of-stake (PoS) consensus mechanisms. However, blockchains like Filecoin utilize storage power as a measure for node eligibility. Node validators are selected based on the amount of storage power they can offer to the network. In return, nodes or storage miners receive mining rewards. In the case of Filecoin, storage miners receive FIL tokens for successful block creation. 

    The storage that miners dedicate to the network is utilized by users of the Filecoin blockchain and system. This is why the consensus mechanism requires all approved notes to be able to prove that they have the storage power needed and that they have an updated copy of the whole system on their servers at all times. 

    Interestingly, storage miners can choose whether they would like to dedicate cloud storage or hardware storage. This makes it incredibly easy for storage miners to acquire additional storage power and move up in node rankings.

    Storage-based consensus mechanisms are rarely utilized in the blockchain industry, however, Filecoin is proof that this system can be successful. Not only that, the highly customizable requirements regarding the type of storage power requested by the network allow storage miners a significant amount of flexibility. This flexibility in node requirements is not usually present in more established consensus mechanisms. 

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