Filecoin becomes a blockchain platform compatible with Ethereum apps

Quick Take

  • Filecoin’s virtual machine will let it support all applications common to Ethereum-compatible blockchain platforms.
  • It may be used for decentralized social media, monetizing datasets and creating NFTs with stronger image availability guarantees.

Decentralized storage platform Filecoin has implemented its own virtual machine, enabling it to support smart contracts — opening it up to the world of decentralized applications, NFTs, liquid staking and more.

The network has always been designed to provide file storage in a decentralized manner — but now that it has launched its Filecoin Virtual Machine (FVM), it can support applications built on it. The goal is that this should encourage more tools built on the network, enable easier trading of tokens, support the creation of decentralized social media and, ultimately, become its own thriving ecosystem.

“The [FVM] augments the utility of Filecoin, and I think it also positions Filecoin as the Layer-1 blockchain that is uniquely positioned to power an open data economy,” said Lukas Bresser, ecosystem growth at Protocol Labs. “It’s a really critical step in this broader roadmap of turning the services of the cloud into open markets. That’s what’s exciting here.”

Enhancing Filecoin’s main purpose

Filecoin’s virtual machine will give it the same capabilities as Ethereum, enabling anyone to build any kind of decentralized application on the network. It will also be able to support bridges to other blockchains and connect more closely to the rest of the crypto ecosystem. Bresser noted that SushiSwap, Axelar and Celer are all integrating with Filecoin.

Applications built on Filecoin will enhance its primary purpose of providing decentralized file storage. Files stored on the network are typically stored for around 18 months before someone needs to manually request the network to store them for another period of time — but applications can now be built that provide many more custom options, including the ability to pay for the data to be stored for much longer periods of time.

Filecoin applications will also be able to monetize data sets. Bresser said that, for example, multiple parties could generate training data on an AI model and upload this to Filecoin. Then anyone who wanted to access the data would pay these parties to do so. In this instance, “everybody who contributed to the data model is rewarded in direct contribution to their training data.”

Bresser added that this could expand to other products like decentralized social media. He suggested users could own their social graphs (the data around their connections and social media usage), control access to this data and monetize it in more ways than just advertising. This would also be possible because data on Filecoin is not stored unencrypted on the actual chain itself.

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“I believe some of the things critical for social networks will be powered by Filecoin infrastructure. We are in conversation with a few of the web3 experiments that are trying to do things around social,” he said.

With the FVM, Filecoi