In those years, whenever I answered the phone, it was almost always the same line—"Bro, don't miss this opportunity, FIL Mining can help you achieve financial freedom." In the spring of 2021, such voices were incessant. At that time, the price of FIL soared to 237 dollars, and the enthusiasm in the crypto world was ignited to its peak.

As an observer who has been navigating the crypto world for many years, I admit that I almost got swept away by this wave. However, after conducting in-depth research, I saw the hidden problems beneath that shiny surface and ultimately chose to remain inactive.

Four years have passed in the blink of an eye. The price of FIL is now fluctuating between 2 and 5 dollars, having fallen more than 99% from its peak. Most of those who invested in mining machines have lost everything, and I want to help you clarify the logic behind this bubble through my observations.

**The beginning of a grand dream**

The original intention of the Filecoin project is grand - to become the storage infrastructure of the decentralized internet era. The underlying IPFS technology aims to replace the existing HTTP protocol, making data storage more efficient and secure through a peer-to-peer network.

In the ICO financing of 2017, Filecoin raised a total of $257 million in one go, which was a record ceiling for blockchain project financing at that time. The list of investors included top institutions like Sequoia Capital. Everything seemed to be going according to plan.

But the reality is quite disappointing. The timeline for the mainnet launch has been postponed repeatedly, with the initial commitment being delayed time and again, totaling four delays, and finally it was actually launched in October 2020. The three-year wait has led many early supporters to start having doubts.

The project's vision indeed sounds appealing: to attract global users to contribute their idle storage space through token rewards, ultimately building a truly decentralized data storage system. This logic is theoretically impeccable.

**The Gap Between Reality and Dreams**

However, ideals are plentiful, but reality is stark. When the mainnet was truly launched, the development of the entire ecosystem did not unfold as depicted in the white paper. The demand for storage did not explode as expected; instead, a large number of miners blindly expanded their computing power to obtain token rewards, leading to the entire network being filled with a large amount of idle storage space.

The logic of miners is very simple: in the early stages, the token output is high, and the coin price is quite good, so they invest in mining hardware. But as more participants join, the market becomes saturated, the coin price begins to decline, and the return on investment plummets. Later on, many people find that their mining machines can't be sold at all, while the monthly electricity bills are a real cash expense.

The cyclical fluctuations of the crypto market have made matters worse. The bear market that began at the end of 2021 caused the price of FIL to plummet, and the winter of 2022 in the crypto industry dealt a deadly blow. Most participants who hoped for financial freedom ended up losing out in the process of this shattered dream.

**Technical Prospects vs Business Realities**

The technical concept of IPFS itself is not problematic. The idea of decentralized storage does address some pain points in the development of the internet. However, there is a difficult chasm to cross between technical ideals and commercial success.

First is the cost issue. Storing data on the Filecoin network is not cheap, and the stability is also average. In contrast, centralized storage solutions like AWS and Alibaba Cloud, although not as cool, are indeed cheaper, more stable, and easier to use. For most users, that is sufficient.

Secondly, there is the application ecosystem. Up to now, there are very few applications that truly store data on the Filecoin network. A large amount of storage space is sitting idle, which is completely different from the project's original vision. Without real demand, the economic model of the tokens cannot function.

In addition to the competition among miners. Early participants obtained a large number of tokens through low-cost hardware investments, but this also meant that the initial distribution of tokens was highly concentrated. When these tokens are gradually unlocked and flow into the market, selling pressure arises. Latecomer miners face increasingly higher mining difficulty, while also encountering a sharp drop in coin prices, making it impossible to recoup their costs.

**Epilogue**

The story of Filecoin is not a particularly tragic one. In the history of crypto, there are countless projects that have declined due to excessive hype, difficulties in technology implementation, and flaws in economic models. FIL is just one of the more typical cases.

It reminds us of a simple truth: in crypto investment, sufficient market demand, feasible technical solutions, and a healthy economic design are all indispensable. Having a vision alone is not enough. Those projects that once shouted about wanting to change the world often end up leaving behind nothing but regrets.