Is Siacoin A Good Investment?

Introduction

Sia is the leading decentralized cloud storage platform and there are no trusted third parties, no signups, and no servers. Sia leverages blockchain technology to create a data storage marketplace that is more robust and more affordable than traditional cloud storage providers.

Sia has created a sharing economy platform allowing users to rent out their unused hard drive storage and enabling those hard drivers as the cloud-based exchange network. Siacoin (SC) is the currency of the Sia network and renters pay hosts in exchange for storage. Sia system allows users to designate unused hard drive storage as nodes within a decentralized blockchain. 

Sia’s main strength is its distinction from traditional cloud-based storage groups where centralized data servers are vulnerable to hacking. Sia’s unique system of a global user-based blockchain is a much stronger preventative for data loss and users themselves determine the price for renting out their unused hard drives thus creating a miniature economic climate that ensures competitive prices and affordable rates.

How Does Siacoin work?

Sia splits all data accumulated across the rented user’s devices, preventing any single hard drive from holding all of your data. Users’ data is instead split into 30 pieces Each of which is encrypted and distributed to different hosts. This creates a helpful fail-safe where if one hard drive fails to store data is not compromised. Uniquely, The user who interacts with Sia coin holds a private key ensuring that they maintain full ownership of their files.

Every file that the users uploaded is distributed through hosts around the globe. This segmentation in Sia is carried out through the use of Reed-Solomon erasure coding. Consequently, if 20 of the 30 hosts encounter problems, the user can still access their files. Sia also encrypts each file part as it leaves the renter’s computer, and the host stores the encrypted files on the Sia platform.

In the Sia platform, the renters create file contracts, including uptime commitments, pricing, and any other criteria the host and the user want to include. These file contracts are a kind of smart contract and create service level agreements or SLAs. Then, these agreements are saved on Sia’s blockchain.

Financial Analysis:

At the time of writing this post (10/14/2021), Siacoin's Return On Investment (ROI) over the past year was 496%, way over its similar projects' ROI that saw an average ROI of 437%. However, it underperformed compared to the market's top 1500 project with an average ROI of 12,809%.

Projects with public Github account have more transparency and reliability. Generally, investing in projects with multiple contributors and commits is considered a safer and better investment (this means they are busy working and building the project). According to its Github account, there are 7 contributors to the development of Siacoin.

Over the last five months, Siacoin's market capitalization rank followed an overall declining trend, starting at the rank of 90-93 on Jul-Aug 2021, reaching 123 in the last weak od Sep 2021. However, by the time of writing this post, Siacoin's market cap rank is about 114 and its value is about $877 million. Moreover, its liquidity score is 57% above the market's average score, making it relatively easier to sell in bear markets.

Another critical factor in the success of any project is gaining public attention. Our data shows that Siacoin's Twitter account saw a growth of 3% over the last months in the number of followers, which is not considerable. Also, the number of Siacoins Reddit subscribers increased, by 9%. However, the Telegram channel users had Zero growth over the last months.

You are saying that Siacoin is the best cryptocurrency to invest in?

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