Analysis: Siacoin


Your decentralized private cloud

1. What is it? 

Sia works on a distributed storage network concept where a file, fragmented into nodes is distributed amongst a network of storage centers. No storage center has the complete file or even a significant part of it. This contrasts with the traditional cloud technology where service providers like Amazon S3, Google Cloud and Microsoft Azure don’t provide decentralization. This gives rise to various vulnerabilities to the user data since it is controlled by a single service provider. In recent years we have seen many service providers compromising the privacy rights of the users in pursuit of obtaining higher profits. The decentralization is achieved by inviting anyone and everyone who would want to rent their storage space and bandwidth. Files are secured by asymmetric key cryptography where only the file owners have access to the private key.

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2. FIT Test (F: Future updates; I: Innovation; T: Trends): FIT Test enables us to check the uniqueness, alignment with respect to the current trends and future update of the fundamentals of the corresponding cryptocurrency.

A) Innovations:

i)Open source: Over a dozen developers have contributed to Sia. Innovative applications are already being built by an active community of developers on top of the Sia API.

ii)Blockchain marketplace: Blockchain technology is used to create a market place where different hosts compete for business. Storage services can be obtained using Siacoin which can be mined and traded.

iii)Decentralization: Sia distributes different fragments of user files across the network of storage hosts. File owners hold the private keys. This prevents anybody except the owner from accessing or altering the files.

iv)Affordable: Sia’s cloud storage is far cheaper as compared to any service provider. Sia charges up to USD $2 per Terabyte of data unlike Amazon S3, which charges USD $23 per Terabyte.

v)High redundancy and uptime: Distribution of fragments across the global storage network prevents single point of failure and ensures highest uptime making it as good as the other service providers.

B) Trends: Preserve user privacy rights, Decrease storage cloud costs.

C) Future updates: With the launch of Sia v1.3.0 – Capricorn, Sia has added on automatic online file repair and upgraded their network capacity and wallet stability. Their public roadmap states many upgrades in September 2017 which includes a reduction in the time required to form file contracts by 12 times. 6-month plan includes implementation of video streaming feature. Sia has about 700 hosts and 2.8 Petabyte of data already. Sia aims to be a strong player in the coming years, competing with giants like Amazon, Google, Microsoft and Dropbox


Siacoin – Your decentralized private cloud


3. Community:

A) David Vorick: Former software developer at IBM and Bitcoin Core developer is also the Co-founder of Sia, a decentralized private cloud storage platform.

B) Drew Volpe: Partner and Co-founder at Procyon Ventures, one of the three major enterprises which contributed to the $750,000 seed for Siacoin says “Every team that works with data in a meaningful way, from AI to precision medicine to Industrial IoT, is seeing an explosion in the size of the datasets they want to be able to work with. Sia has the potential to be a game changer for them by fundamentally changing how data is captured, stored, and distributed.” Drew is known to be an entrepreneur, investor and an experienced technologist in the field of search, machine learning, sensors and mobile technology. He is also a mentor to startups at MIT, Harvard and other major institutions across the globe.

C)  Joshua Langsam: Associate Director at Raptor Capital Management, second of the three major enterprises which contributed to the $750,000 seed is impressed by Sia’s distributed cloud storage platform. Raptor Group is a private investment company.

D) Fenbushi Capital: This Chinese venture capital firm invests exclusively in projects associated with blockchain technology.

E) NextCloud: NextCloud, an open source alternative to Dropbox has partnered with Sia.

4. Downside/Risks:

a. The path of adoption to new technology has always been long. It will take time for users as well as hosts to start accepting such a platform and migrating their data to it.

b. It could take quite a lot of time for Sia to achieve a decent amount of traction which would help realize the value they are projecting at the moment

c.  There is no limit to the number of Siacoins minted. There are close to 30 billion Siacoins in circulation today. The purpose of Siacoins is to ensure the fulfillment of transactions across the network and not to be used as a digital currency per se.

5. Future:  The cloud storage market is undoubtedly a large market. Sia’s promising ability to implement storage at a far cheaper rate than the large players in the market and partnership with NextCloud proves that Sia is here to stay.

6. Technical analysis:


Technical Analysis of Siacoin indicates that it has corrected itself beyond 60% which is a usual threshold before a further surge. This makes the current price of Sia quite appealing. Risk/Reward ratio is 2.13 which makes the investment opportunity very lucrative.

Following are the statistics inferred from the technical analysis:

i) Risk/Reward Ratio: 2.13

ii) Optimal Trade Entry (OTE): 0.00000332 – 0.00000348 BTC

iii) Market Cap: $ 232,861,788

The ideal Risk/Reward Ratio tends to 2.

7. Comments: Sia’s path-breaking solution for cloud storage is fundamentally strong which makes it a good investment but Sia’s at an early stage development and it could gain value over time once it starts achieving what it promises.


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