The Filecoin TL;DR team was thrilled to be back in Singapore for Asia’s much-awaited blockchain week from Sept 11–15 2023. The week-long series of gatherings was spread across major Web3 events including the FIL Dev Summit and Token2049.
In this blog post, we’ll share our key takeaways from the week. This blog is organized into the following sections:
Takeaways from FIL Dev Summit
Ideas for upgrading Filecoin
Better Governance to meet Filecoin network’s growing needs
Upgrading Filecoin Plus
Takeaways from Token2049
Scalability is at the top of everyone’s mind
RWA is powering DeFi
AI needs decentralized storage
FIL Dev Summit: Top Three Takeaways
1. Ideas for upgrading Filecoin
FIL Dev Summit, inspired by the successes of IPFS þing, was organized as a three-day event for the community to come together and have impactful conversations that help push the Filecoin Masterplan forward.
Juan Benet, Founder and CEO of Protocol Labs, visualized what Filecoin’s success should look like using simple metrics such as the number of internet users, HTTP requests per day, and total data stored. His simulation provided a concrete list of protocol upgrades and design improvements the Filecoin network should strive for in the near future.
“The chain must scale. The good news is we’ve been working on it for many years now,” Juan said. He laid out some key ideas for upgrading Filecoin including the possibility of crafting new provider roles and developing cheaper and faster PoReps. You can read our TL;DR on the full list of ideas or watch the video below.
2. Better Governance to meet Filecoin network’s growing needs
The need to enhance governance processes and tooling has gathered momentum with the growing community. In an effort to bridge the gap between existing technical experts and new community stakeholders, the proposed changes by the Filecoin Foundation to the FIP (Filecoin Improvement Proposals) process were reviewed under the FIP0001v2 Initiative.
Several ideas emerged from these discussions which will likely be taken up at the Iceland track:
Increase efforts to produce materials about Filecoin governance for Storage Providers
Form an “author collective” to push an idea through draft and soft consensus
Work to refine proposals for including ‘ecosystem stakeholders’ and other institutional network participants in governing decisions
3. Upgrading Filecoin Plus (Fil+)
“Fil+ has gaps and constraints, but it is fundamental to the network.”
— Juan Benet
Filecoin Plus (Fil+) is an incentive mechanism that encourages the onboarding of useful data onto the Filecoin network. The FIL Dev meetup was an opportunity to align the community with network subsidy structures and shape the future of Fil+ together.
Juan proposed three major ideas in his keynote address:
Better abuse measurement
Creating concrete disincentives like slashing to prevent abuse
Experimenting with new Fil+ design mechanisms for DataCap allocation
Discussions covered topics ranging from Fil+ design collaborations to KYC implementation and even smart contract designs in the near future. The community proposed two major changes to DataCap Pathways: programmatic notaries and increasing automation.
The crypto winter has brought back the focus to building web-scale applications that can onboard the next generation of users. However, the key challenge to mainstream adoption remains Scalability.
Juan Benet highlighted three separate but interconnected solutions — the Filecoin Virtual Machine, Compute over Data, and Interplanetary Consensus (IPC) — that the Filecoin network is building to enable web-scale applications. IPC – the protocol and software stack for creating a tree of subnets – will directly enable chains to handle billions, if not trillions of transactions per second.
Likewise, several L1 and L2s showcased solutions that they believe will solve for scalability. Sandeep Nailwal, the co-founder of Polygon Labs, unveiled Polygon 2.0 to achieve infinite scalability (the ability to have unlimited websites, apps, software, and servers) similar to Web2 infrastructure.
VCs were hopeful that Web3 would achieve the scale desired shortly. Lasse Clausen, Founding Partner at 1kx, in a panel on Navigating the Web3 Venture Landscape,said, “Now for the first time (with account abstraction and Layer 3 solution) it makes sense for entrepreneurs to build consumer apps on cryptos. In the next few years, I expect many apps to be crypto-native.”
2. RWA powering DeFi
Within the DeFi ecosystem, interest has been growing in Asset Tokenization – which involves representing ownership of Real-World Assets (RWA) as digital tokens on the blockchain. There was hardly any conversation at the conference on DeFi without mentioning RWA. RWA protocols have done well in 2023 with tokenized treasuries gaining significant traction despite much of the DeFi activity remaining sideways.
RWA category TVL chart from Q3 2021 until August 2023. Image source: DeFiLlama
The exploration of RWA is bridging traditional financial markets with DeFi while unlocking new possibilities. RWA protocols have brought with it new necessities for DeFi. Blockchain oracles, for example, have become an important cog in asset tokenization. They provide live data feeds (from real assets like gold and oil), which are used to price RWA-backed tokens on various platforms.
3. AI needs decentralized storage
As expected, several references were made at Token2049 on the role of crypto in an AI-driven era. Arthur Hayes likened AI to a new economic entity that could benefit from cryptocurrency serving as a means to facilitate transactions. He went a step further to explain why AI needed decentralized networks like Filecoin to provide computing power and data storage instead of centralized systems.
“Artificial Intelligence, a dominant force in the crypto and tech sectors, necessitates decentralized storage. Relying on centralized solutions like Amazon means entrusting vast swathes of data to entities that can unilaterally alter terms, hike prices, or even shut down services”
The panelists in a parallel discussion on Web3 and AI had interesting takes on Peter Thiel’s famous quote from 2018 — “AI is Communist. Crypto is Libertarian.” While partially concurring with Peter’s foresight, Vassilis Tziokas from Microsoft elucidated that AI has evolved to be top-down while crypto’s ideal state is self-custody or self-autonomy.
The events were marked with strong attendance and a great deal of enthusiasm about the future. For the Filecoin ecosystem, the summit helped forge a stronger builders’ community and set the stage for important protocol upgrades to come. Overall, the blockchain week in Singapore augured well for Web3’s long-term growth and adoption.
If you missed Singapore and want to participate in shaping the Filecoin network, you can attend our future events: Iceland FIL Dev Summit (Sep 25–27), Fil Vegas (Oct 3–5), and LabWeek23 (Nov 13–17).
Thank you to Takamasa Minami, Savan Chokkalingam, Pietrek Chan, and Isabella Bu for contributing. Shoutout to duckiehan, Vik Kalghatgi for shaping and reviewing this piece.
Unlike proof-of-stake cryptocurrency protocols that directly provide rewards for locking staked tokens, “staking” FIL is much more akin to a lease.
You may have heard of services or applications that enable “Filecoin staking.” However, “staking” on the Filecoin network is different from proof-of-stake cryptocurrency protocols like Ethereum. Filecoin “staking” allows storage providers (SPs) to borrow FIL which they use as collateral to provide storage on the Filecoin network.
Unlike proof-of-stake cryptocurrency protocols that directly provide rewards for locking staked tokens, “staking” FIL is much more akin to a lease. SPs borrow FIL to use as collateral and may pay a fee. Applications facilitating this may also take a fee.
You can think of a FIL lease to a storage provider like a car being leased to an Uber driver who makes money providing rides through the Uber platform. During the lease term, the car owner receives lease payments from the Uber driver; when the lease is over, the car is returned to the owner.
Why do storage providers need FIL collateral?
Filecoin storage providers (SPs) contribute data storage capacity to the Filecoin network.
In order to ensure that files are stored reliably over time, SPs are required to post FIL as collateral. If an SP fails to meet their responsibilities (perhaps they go offline or stop storing certain files) their collateral is slashed, meaning that they lose a portion of the FIL they posted as collateral.
A storage provider can buy or earn FIL to provide the collateral they need to run their data storage business, or they might borrow/lease FIL from existing token holders.
Centralized vs decentralized applications
Third-party centralized programs enable storage providers to borrow FIL to use as collateral. In the centralized model, token holders transfer custody of their FIL to centralized intermediaries for set periods of time. These intermediaries allow SPs to borrow FIL, and distribute fees collected to token holders.
This model requires that token holders trust the centralized intermediary with custody of their FIL. Some centralized programs rely on multi-sig transactions. Multi-sig is short for ‘multi-signature’, which means a transaction has two, or more, signatures before it is executed. However, multi-sigs still rely on human intervention.
Using any third-party application carries risks, and it is critical to thoroughly research any application to understand all these risks. Some areas to consider are:
Audits: Has a third-party audited the code and are the results published publicly?
Open Source: Is the code available to inspect publicly?
Bug Bounty: Does the program provide a bug bounty to incentivize anyone to report/fix possible vulnerabilities?
Trustless: Can you use the application without relying on an intermediary; is there a single point of failure?
Disclaimer: This information is for informational purposes only and does not constitute investment, financial, legal, or other advice. This information is not an endorsement, offer, or recommendation to use any particular service, product, or application.
This guide outlines how to transfer FIL from your Ledger wallet to your MetaMask wallet, and how to use Ledger to secure your Metamask wallet for the FVM.
Transfer FIL From Ledger to Metamask
To access dApps on the Filecoin Virtual Machine (FVM), you need FIL in a 0x/f410 wallet address. However, Ledger Live has not yet been updated to support the direct transfer of FIL to 0x/f410 addresses. To move FIL from a Ledger wallet to Metamask follow the steps below:
Open Ledger Live. Click [Send] and select your Filecoin account to debit. Then paste your Metamask 0x address. As you can see, Ledger Live does not yet support 0x addresses for FIL. It displays an error that reads, “This is not a valid address.”
You can use Glif.io to send FIL from your Ledger directly to Metamask (0x). Visit Glif.io and click [Connect Wallet].
Connect your Ledger device via USB and select Ledger [Filecoin]. Make sure you have closed Ledger Live to avoid device access conflicts.
5. Allow glif.io to connect with your device.
Your Ledger wallet and FIL balance should now be displayed. Click [Send FIL] to transfer from your Ledger to Metamask.
7. Paste your Metamask (0x) address into the recipient field. Glif.io recognizes this 0x address as a valid FIL wallet address and also shows the corresponding f410 address.
Click [Send] and approve the transaction on your Ledger device. Your funds should be available in Metamask after around two minutes. You can check that your funds have arrived by searching for the destination address in a block explorer like Filfox.
Use Metamask with a Ledger on the FVM
Metamask has support for Ledger wallets, meaning you can hold funds on a Ledger device to use with the FVM. Note that to use the FVM, we will need to use 0x/f4 addresses. To configure use your Ledger with Metamask, you will need to do the following:
Ensure Metamask is connected to the Filecoin Network
Connect your Ledger device to the Ethereum network and connect it to Metamask. Copy the 0x address you see here. Note: This is counterintuitive but has to do with how signatures are generated. The address that will show up in your Metamask wallet (when connected to the Filecoin Network) while your Ledger device (with the Ethereum app open) is connectedwill be able to send transactions on the FVM.There is a PR to get f4/0x support in the Filecoin Ledger app for the FVM, which when merged will mean one will only need to use the Filecoin app on their Ledger device.
You can now follow the rest of the instructions described above starting with Step 3 of the previous section. Note you will need to switch back from the Ethereum app on your Ledger to the Filecoin app to initiate the transfer in Step 4 of the previous section.
Once the funds have been sent to the 0x address (copied in Step 2 of this section), you will be able to to initiate transactions via Metamask and sign transactions using the Ethereum app on your Ledger.
In order to access dApps on the Filecoin Virtual Machine (FVM), you need to have FIL in a 0x/f410 wallet address. However, several popular exchanges have not yet been updated to support the direct transfer of FIL to a 0x/f410 address.
If you need to move FIL from an exchange that does not yet support 0x/f410 addresses follow the steps below. These steps will show you how to use a GLIF burner wallet to facilitate the transfer.
Log into your Coinbase account. Ensure you have some FIL. Then click [Send & Receive] in the upper right-hand corner.
3. If you enter your Metamask 0x address directly into Coinbase you will see an error. This is because Coinbase has not yet upgraded to support sending FIL to 0x/f410 addresses. You will need to send your FIL from Coinbase to an intermediary wallet that supports all FIL address types. In this example, we will use a GLIF.io burner wallet.
To get your recipient address visit glif.io click [Connect Wallet] and create a [Burner Wallet]
A random seed phrase will be created. You can use this seed phrase to recover this burner wallet in the future if you need to. Click [Create seed phrase] to open your new burner wallet.
6. When your GLIF wallet is created it should have an f1 address like this (eg. f1fnqqhhor2y4metvokp22kdtnl7qbg6rso7kqp7a) Copy this address and enter it as your Coinbase recipient.
7. Coinbase should no longer show an error when you send your FIL to your GLIF f1 wallet address.
8. Once the transaction is complete and the FIL is visible in your GLIF wallet open Metamask and copy your 0x address.
Return to your GLIF burner wallet and select [Send FIL]. Paste your Metamask 0x address as the recipient. Send your total FIL balance from your GLIF wallet to Metamask — why would you want to keep FIL in a burner wallet?
10. Once the transaction is complete you should have your FIL balance in your Metamask 0x address and ready to use on any number of FVM dApps.
In the future, Coinbase may join other exchanges in allowing FIL to be sent directly to a 0x address so these steps will no longer be necessary.
How to transfer from a Metamask wallet (0x) to a Coinbase (f1) account
To reverse the process described above and send FIL from an Ethereum-based wallet like Metamask to an f1 address follow the steps below.
If you attempt to transfer FIL from a Metamask 0x account to any f1 wallet you will get the following error: Not ETH network, set to lowercase. This error is because Ethereum-based wallets do not natively recognize the f1 address formats.
2. To transfer your FIL from an 0x Ethereum-based wallet like Metamask to an f1 address use the GLIF FILForwarder. Visit glif.io and connect your Metamask wallet.
Once your wallet is connected click [Send/Forward FIL]
4. Paste your Coinbase address (f1) in the [Recipient] field and enter the amount of FIL you want to send. Make sure you leave a small amount of FIL on your Metamask wallet to pay the gas fee.
5. Your funds should be available at the destination after around two minutes. You can check that your funds have arrived by searching for the destination address in a block explorer.
