How to buy Filecoin online
This page gives you an introduction on what Filecoin is, how it works, and what’s so important about the FIL token. You can also find out where’s best to buy FIL and how to do it.
Compare where to buy Filecoin, and open an account
If you just want to get started and buy Filecoin straight away, use one of the brokers below. If you want more information before you invest your money, read on to find out more about Filecoin.
What is Filecoin?
Filecoin is like a decentralised version of Dropbox, somewhere for customers to store files without having to use cloud services owned by big corporations. Anyone with spare disk space can join Filecoin and rent it out to a customer looking for somewhere to store their data.
The FIL cryptocurrency powers Filecoin, where it acts as an incentive to good behaviour and is the currency for all transactions between customer and supplier. All those transactions are stored on a publicly available blockchain.
By bringing individuals together directly the Filecoin platform is able to cut out the middleman. This is targeted at companies like Amazon or Microsoft who traditionally dominate data storage, act as censor, and charge high prices. Filecoin was formed in 2017 and, along with other platforms like Storj and Siacoin, has led the way in using blockchain technology for decentralised storage.
How does Filecoin work?
Filecoin works by creating a marketplace that brings together suppliers of disk space with customers demanding it. Whenever a customer wants to store some of his data, the suppliers compete to offer him the lowest price. The successful supplier is rewarded after they’ve proven the data is stored securely, with all proof stored on the blockchain and so visible to everyone.
Finally, there is a third group of people who use their computer power to retrieve files whenever the customer wants to access her data. Those retrievers earn a transaction fee as well, and every transaction is done in FIL with a record of all payments also stored on the blockchain. As the suppliers only receive their fee once the data is secure, FIL is the incentive for everyone to act in good faith.
How to buy Filecoin online – a step-by-step guide
Step 1. Find an exchange to buy Filecoin
If you’re want to buy Filecoin immediately, here are two of the top exchanges around:
- Binance: One of the biggest names in the cryptocurrency trading space, Binance allows users to trade hundreds of different cryptocurrencies, including Filecoin. Open an account right now.
- BitMEX: A peer-to-peer cryptocurrency exchange platform that allows for trading using Bitcoin (BTC). All accounts also provide users with an online wallet in which to store their coins. Open an account today.
Step 2. Sign up and fund your account
Most exchanges require you to sign up and create an account before you can buy crypto. This is a simple process but you’ll usually need some form of photo ID to confirm your identity. This can vary across platforms but normally a passport or driving licence is all you need.
When you’ve created the account, you can deposit your fiat currency or cryptocurrency. Now you’re ready to buy Filecoin.
Step 3. Buy Filecoin
If you used Bitcoin to fund your account, just search for the FIL/BTC crypto pair and you can execute your trade straight away. The process is the same whichever crypto you’ve deposited, you just need to find the current FIL price and click ‘buy’.
Step 4. (Optional) Get a suitable wallet
You can get a wallet to hold your coins securely. This isn’t necessary, most exchanges let you store your coins with them, but you may want to do it if you’re going to hold your Filecoin for a long time. There are plenty of websites that offer wallets, but if you want to create one straight away you might want to consider these two wallet providers:
- CoolWallet: As a hardware wallet, CoolWallet stores private keys to secure your coins and offers support for some of the top cryptocurrencies around. Join Coolwallet today >
- Guarda Wallet: Guarda is an open-source cryptocurrency wallet that lets you hold a variety of cryptos in one place. On the platform, you can store all the most prominent coins, in addition to thousands of tokens and a large number of stablecoins. Sign up for Guarda Wallet >
How to trade Filecoin – a step-by-step guide
Step 1. Find a broker
You should make sure to check your broker offers Filecoin before signing up. There are a lot of brokers out there where you can trade cryptocurrency, but Filecoin is a smaller crypto and isn’t available on many platforms yet. eToro and Robinhood are two of the top options to check first.
Step 2. Deposit money
You can fund your broker account with fiat currencies, but you should always check the trading fees before you start. These vary by broker and you want to minimise fees to make sure you get the best value for money when you trade.
Step 3. Decide how you’d like to trade
There are plenty of different ways to trade cryptocurrency. Usually, you’re speculating on the price moves of your chosen coin rather than owning it outright. One example of this is spread betting, where you try to predict how the market is going to move.
Step 4. Start trading
Now that you’ve set up your account, you can start trading. If you’re new to trading or to cryptocurrency, it might be a good idea to start with a demo account to practice without the risk of losing money.
In terms of trading strategies, it depends on your outlook for Filecoin. Positive traders who think the coin is going to go up in price can take a long position and try to profit from the increase. If you think the opposite, that FIL is going to go down, you can decide to ‘short’ it and back the price to fall.
Another option for more experienced traders is to use leverage. Trading with leverage can be dangerous for beginners because it significantly increases the risk of losing your money, but it allows you to trade much larger amounts while only putting up a percentage of the funds yourself. This is called trading with the ‘margin’ and can lead to extreme results in both directions.
It’s not always easy to make a decision when it comes to an area as competitive as cryptocurrency. Here are some of the pros and cons of Filecoin you can use to help you make a choice. Finally, there are some questions to think about below as well.
- Filecoin is an early market leader in decentralised file sharing
- FIL is quite inexpensive and more stable than some other coins
- You can earn extra FIL by participating in the platform
- File-sharing is dominated by conventional heavyweights that will be hard to dislodge
- Needing FIL to use the platform creates a barrier to entry that might put off newcomers
- Has experienced controversy over its handling of a ‘miner’s strike’
To help you decide, here are three more questions to think about before you invest in Filecoin.
1. Is it a good time to buy Filecoin?
To decide if now is a good time to buy FIL you should think about your goals. If you want to use the Filecoin platform, FIL is essential to being able to join in. If you’re looking for a long term investment, you need to think about the competition from other decentralised platforms and the established industry and how you expect Filecoin to overcome it.
On the other hand, if you just want to get stuck in to short term trading you should start by looking at the current FIL price to decide whether it represents a good opportunity. Then you can think about using some trading methods to take advantage. You should also have a look at the latest market analysis for signs of anything that could affect the FIL price, and you can find that here:
2. What problem does Filecoin solve, and what are the coin’s investment prospects?
Filecoin makes file storage cheaper and more democratic by taking away the power of global corporations to act as gatekeepers. Instead, it provides a decentralised platform built around individuals, with the FIL coin acting as both a payment mechanism and the incentive for everyone to act in the general interest.
FIL’s investment prospects depends on how well the Filecoin platform grows. One challenge is going to be the fact the traditional industry it wants to disrupt is convenient and popular, while Filecoin itself has been embroiled in some controversies in its early years. It’s had disputes with its own miners and faced a legal challenge over how it distributed coins to its employees.
Those early challenges are in the rear view mirror but it’s a reminder to always do your research. There are other cryptocurrencies based on file sharing platforms as well as an established industry run by some of the biggest companies in the world. You can keep track of all their developments by following the latest news below:
Filecoin (FIL) surges by 6% after listing on Coinbase
The founder of Filecoin denies that miners are on strike
Filecoin listed by Gemini and Kraken as mainnet launch approaches
3. Do you want to hold Filecoin for the long term?
Filecoin is a good investment if you want to use its file sharing service as FIL is the only cryptocurrency that can be used on the platform. Otherwise, you should think about FIL’s long term prospects versus the competition. Any sign of increased regulation of the traditional players in cloud storage could be good news for alternatives like Filecoin, so you should stay on top of the latest news.
Considerations for a long term investment strategy
The two main things to consider are the current state of established file-sharing companies and the decentralised competition. If you think those look positive for Filecoin, you should sign up for an exchange and buy some FIL right away.
You might also want to think about getting a wallet to store your coins, particularly if you don’t intend to use them to pay for any of Filecoin’s services.
Considerations for a short term trading strategy
If you want to buy and sell Filecoin in the short-term to benefit from its price fluctuations, the broader market forces are much less important. You should note that FIL has tended not to be very volatile, which might reduce the opportunities available for trading. Before you start trading you should make sure to pick a broker with low trading fees. It’s also a good idea to learn how to read charts and perform technical analysis on the FIL price.