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Filecoin’s creator denies any existence of strike among its miners

Photo of: Sangeetha Golchha
by Sangeetha Golchha

Within a few days of the Filecoin mainnet launch, Justin Sun tweeted that Filecoin was involved in some exit scam strategy and now it has been alleged by a crypto Twitter user that Filecoin’s miners are apparently on strike since last week. 

Juan Benet who is the creator of the blockchain-based data storage platform Filecoin has called such allegations about the miners of the token being on strike absolutely nonsensical. As per a report, five of the biggest miners of Filecoin have turned off thousands of rigs in order to protest against the platform’s economic model of existence. The model demands that the miners have to stake Filecoin Tokens (FIL) as collateral whenever they produce a block. But the problem in doing so is that many miners are facing the trouble of lack of enough FIL tokens to do the same. 

Nico Deva, user of the crypto Twitter universe, was the first user to claim that a majority of miners in Filecoin were on strike because they needed to buy FIL so that they could explore the potential of mining capacity. This requirement reportedly was not liked by some of the top miners located in China which could have led to a possible strike. Deva said, pointing out to Filecoin’s Initial Coin Offering which raised more than $200 million in less than an hour. 

“A napkin calculation shows you early on that your mining system that requires $20K hardware also forces you to buy more coins. In a country where ponzinomics is an art, the 2017 poster boy just [blew] it.”

But Benet has claimed on Twitter that the miners are not under strike but rather they are producing blocks at a slower pace. 

Source: Twitter

He has claimed that the project itself had advised many of its miners to slow the growth rate so that it could match up the token flow because of the requirements of the protocol. They asked the miners to stop for a while until they could actually afford to grow in a steady manner. 

“Some of the miners’ growth decrease is from following our advice,” said Benet.

In the tweet, Benet also shared data about Filecoin’s top miners earning $352,000 within a span of 24 hours. Not just that he also added that the top 50 miners reportedly earned $3.7 million in rewards. The creator further shared that it is difficult to be adding more capacity to the network as of now. 

“There are some miners that no doubt want to push things and try to get more. If they could guilt the community into giving them a lot more money, it may be worth a shot. A thing you learn quickly when there’s lots of money at stake is people will come out of the woodwork to take it, and they will try all kinds of manipulative tactics.”

With Filecoin’s mainnet launch last week, FIL token trading has begun across major exchanges. The price of token saw a 118% jump in less than two days after which it dipped 80%.