# The Problem with File Storage

## The Problem with File Storage <a href="#af21" id="af21"></a>

Current data storage solutions, like Amazon and Google, are centralized and therefore vulnerable to attack. Additionally, we’re creating massive amounts of new data every year.

In 2018, humanity produced more data than in the past 5,000 years combined. The demand for storage doesn’t seem to be slowing down.

Filecoin seeks to capitalize on the increasing demand for storage using blockchain technology to coordinate a peer-to-peer network of storage nodes.

## How Filecoin Works <a href="#id-38dd" id="id-38dd"></a>

As a Filecoin user, you’ll specify the file you want to upload and pay a small fee to have your upload request listed on the Filecoin exchange. There, storage nodes will bid on the rights to store your file.

This bidding process is designed to get the uploader the lowest price possible. The Filecoin exchange is a decentralized exchange with its order book living entirely on the Filecoin blockchain.

<div align="center"><img src="https://miro.medium.com/max/1400/1*_lfSOXg44rMudbN0bNB5dw.png" alt=""></div>

### FIL cryptocurrency mining <a href="#id-7c91" id="id-7c91"></a>

Miners are an integral part of the Filecoin ecosystem. Anyone can participate in mining FIL digital coins and monetize the free space on their PC’s hard drive.

The mining is done by processing data from customers who want to deposit their files.

Miners fall into two categories: keepers and receivers. The former take customers’ orders and place them on their drives. The latter are responsible for the process of returning data to customers.

![](https://1938044470-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2FsZWCDVBAAapByi8UQw4c%2Fuploads%2F898jVi5jkpi7rLJVyGBH%2Fimage.png?alt=media\&token=af81d8a7-1a0b-411f-9e44-360a61e83b36)

Miners often combine drives and other equipment to win storage deals and earn more FIL coins.
