Storj: Building a Distributed Data Farm (ICO Review)
Storj is among the rare recent ICOs that have a working product. What is Storj?, How to invest, store the tokens or support the project.
Storj Labs is the world's largest distributed cloud storage provider, at least according to the company profile. The company hopped from one hot trend to another, as it created an ICO in April 2017. Storj Labs provides a "farm" of distributed computers where users rent out their hard drive space to serve as cloud storage. And while Storj was an already growing and trendy company with a revenue stream, the token sale was intended to fuel innovation and increased market share.
Storj performed one of the largest tokens sales of 2017, attracting $30 million in funds.
Storj Market Price
Currently, the Storj market price has sunk along with other cryptocurrencies and tokens on a generally worsening market sentiment.
At one point a couple of months ago, the Storj market price ran hot after it hit exchanges following the ICO. The STORJ token peaked at $2.20 for a brief moment before sliding to its current levels. Despite the solid product, the STORJ market price has taken a beating and only managed to rise briefly on what looked like a temporary pump.
The STORJ token serves both as a market asset and as a way to purchase the company's services. But it is not key to using the Storj service, and it is not native to the system. Users may pay as easily in cash, Ethereum or another method.
The STORJ token is the standard ERC-20 Ethereum-based version of an older coin, StorjcoinX. The first coin started off in 2014 with a price of $0.1. The two tokens share a part of their history, and now STORJ is replacing the old one. Still, some remaining SJCX coins are being traded on Poloniex. The old token may be converted into the new one with an automatic service.
As for the STORJ token, in a week the time period for a locked portion of tokens will run out. No one knows yet what would happen to those tokens, as there is no official audit of the token sale. With an increasing token supply, the STORJ price may drop further.
Bittrex is the most active marketplace that keep the token moving, with more than 60% of daily trading happening against Bitcoin. There is no direct way to inject fiat funds into Storj, not even through an Asian exchange. This makes the STORJ price vulnerable to manipulation by Bitcoin or Ethereum whales.
The Storj Community
The Storj Reddit community is following the company's developments very critically. The development team had a crisis and a lag of output, but news and updates were expected in September. For users desiring to do more due diligence, a registration at this link will give access to the developers' team discussions. The community fears that another developer crisis may happen, where Storj is left without brainpower for updates and fixes.
STORJ is also a coin that can be mined, although users need to provide disk space instead of processing power. In fact, mining doubles up as offering cloud storage, although the payouts are in STORJ tokens and not in fiat.
The Storj community releases a monthly report on payouts, showing that the cloud service is indeed distributed among small users that receive a few STORJ per month.
So what if you like Storj and join to rent out your HDD to a storage farm? What happens if the FBI or another government agency wants the information?
Storj said it would comply with such demands, although so far, no warrant has been served. The company releases a monthly declaration that there are no current warrants served. And yet a government search for data would create a problem for the company, as the data is shredded and distributed among computers, with at least three nodes creating redundancy so that user files are always available.
The Storj business model directly competes with giants like Amazon and Microsoft. The difference is that Storj manages to offer storage services without owning a storage farm. One could say Storj is the AirBNB of storage solutions. The Storj advantage, as the white paper promises, is increased security and lowering the chance of attacks to a large centralized data storage provider.
The blockchain-based competitors to Storj is MaidSafe, as well as Siacoin. It is still unknown what advantage Storj has compared to these platforms.
The Verdict on Storj
STORJ is an ERC-20 token, meaning you can easily store it in MyEtherWallet, without the need for downloads. The current price is roughly the same as the ICO levels in May, due to the market correction. But it is still unclear if the price may stop sliding downward on organic investments. This is not the best token to learn about cryptocurrencies, as it is harder to acquire and would need the creation of a Bittrex account.