While the crypto world often gets caught up in price charts and memecoins, a quiet revolution is taking place beneath the surface. Filecoin, the decentralized storage network that once flew under the radar, has begun showing signs of significant momentum.
From onboarding major projects in Web3 to becoming a foundational layer for real-world asset (RWA) tokenization, Filecoin is no longer a niche experiment—it’s positioning itself as essential infrastructure. The recent expansion of its Layer 2 ecosystem and strategic partnerships with AI and data-heavy applications signal a maturing protocol.
Decentralized Storage: From Ideals to Operational Efficiency
Decentralized storage isn’t just a more private or censorship-resistant version of Dropbox; it represents a new paradigm in data ownership and accessibility. The concept roots itself in the InterPlanetary File System (IPFS), a protocol for peer-to-peer file sharing that ensures data is distributed and not reliant on centralized servers.
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IPFS (InterPlanetary File System) is a decentralized protocol for storing and sharing files on a peer-to-peer network. Unlike traditional web systems that rely on centralized servers, IPFS uses a distributed network where files are identified by their content, not their location. When a file is added to IPFS, it gets a unique cryptographic hash. Anyone retrieving that file asks the network for the hash, and the file is delivered from the closest or fastest peer that has it. This makes IPFS more resilient, faster for global access, and censorship-resistant, while reducing dependence on single points of failure like traditional web servers.
Many projects attempted to realize this concept in practice, but Filecoin stands apart for its size and robust Layer 1 base.
The Filecoin story begins in 2014 with Juan Benet, the founder of Protocol Labs and the inventor of IPFS.
The vision of Benet was simple but bold: create a decentralized marketplace for storage that incentivizes participants to rent out unused space. The idea took off with Filecoin’s 2017 ICO, which raised over $200 million—one of the largest at the time.
The mainnet finally launched in October 2020, after years of development. What followed was a rapid expansion of its Layer 1 infrastructure.
Highlights include the introduction of smart contracts (Filecoin Virtual Machine), interoperability with Ethereum via the FEVM, and the ability to store verifiable data for large clients.
As for the operational metrics, Filecoin has experienced significant growth in data storage utilization, despite a decline in total storage capacity. After peaking at nearly 17 exbibytes (EiB) in Q3 2022, the network's capacity decreased to approximately 4.2 EiB by Q4 2024.
This reduction was part of a strategic shift from incentivizing storage supply to focusing on onboarding high-value enterprise clients. Consequently, storage utilization improved markedly, rising from just 3% in late 2022 to 32% by the end of 2024. By December 2023, the network had stored over 2 million terabytes (approximately 2,000 PiB) of client data, marking a 19-fold increase over 18 months.
The largest users by their share of total storage are:
- Media and NFT storage platforms like NFT.Storage and Web3.Storage. These platforms serve a broad user base, including major marketplaces like OpenSea and Solana. Ewesion, China's fastest-growing host of graphic files, uses Filecoin for data preservation, storing approximately 1 EiB of visual data.
- Scientific Research and Public Data Archiving institutions like CERN's ATLAS Experiment, UC Berkeley and Internet Archive's "Democracy's Library" initiative. Also, Starling Lab, which, in collaboration with Rolling Stone, created an interactive Web3 archive to authenticate and preserve records of alleged war crimes, storing complete digital records on Filecoin.
- AI and Machine Learning Organizations like Aethir, a decentralized GPU cloud computing platform and SingularityNET
The demand for decentralized storage showed signs of growth during the NFT boom of 2021, when projects needed a way to ensure metadata and assets wouldn’t vanish if a central server went offline. Now also, with the tokenization of RWAs and increased institutional interest in blockchain-based data solutions, the need for scalable, tamper-proof storage is strong.
Layer 2 and the Commercialization Push
However, Filecoin had to not only provide a functional decentralized storage solution but also to compete with traditional providers in performance and reliability.
What truly accelerated Filecoin’s utility in this regard was the emergence of its Layer 2 ecosystem. While Layer 1 handles the heavy lifting of raw storage and consensus, Layer 2 is where applications meet users.
Filecoin Layer 2 Basin
Among the notable L2 solutions is Basin, developed by Textile.io. Basin introduces a dual-layer architecture combining a hot cache layer for real-time data access and a cold storage component for long-term archiving. This design caters to data-intensive applications, such as AI and IoT, by ensuring immediate accessibility and cost-effective storage. Basin's compatibility with S3 interfaces facilitates a smoother transition for developers moving from traditional to decentralized storage systems. Real-world applications of Basin include processing weather data from decentralized stations and generating synthetic data for smart contracts.
Filecoin Layer 2 Akave
Another significant L2 solution is Akave, which focuses on creating on-chain data lakes. Akave's platform supports advanced data handling features like customizable replication policies and erasure coding, enhancing data security and availability. By integrating with Filecoin's IPC, Akave offers users continuous visibility into data status and history, promoting transparency and trust. This approach is particularly beneficial for managing large volumes of data in decentralized networks, making it ideal for big data analytics and AI applications.
Filecoin Layer 2 Storacha
Storacha Network addresses the needs of AI and unstructured data storage by providing high-performance decentralized hot object storage. It ensures rapid data access and retrieval, essential for AI applications requiring quick processing and scaling. Storacha also emphasizes user control over data through the User Controlled Authorization Network (UCAN), offering secure cryptographic proof of data ownership and access rights without frequent blockchain interactions. This solution supports a range of AI use cases by facilitating fast, scalable object storage optimized for both structured and unstructured data.
Filecoin Layer 2 EpiK
EpiK Protocol represents a unique approach by integrating Filecoin's technical advantages to build a second-layer storage network focused on knowledge graphs. EpiK serves as a secure and trusted knowledge graph collaboration platform, enabling decentralized co-construction and sharing of information. By organizing small knowledge graph files into larger snapshots and transferring them to Filecoin storage, EpiK enhances the efficiency of data retrieval and ensures the permanence of valuable information.
On Filecoin itself there is a blossoming array of tools, apps, and service providers designed to commercialize decentralized storage:
- Lighthouse: A perpetual storage solution aiming to make NFT and RWA data tamper-proof.
- Estuary: Bridges IPFS and Filecoin, streamlining the process for developers.
- Seal Storage: Enterprise-grade services targeting institutional clients.
- Huddle01: Video conferencing built on decentralized infrastructure.
- Bacalhau: Decentralized computation over stored data, marrying compute and storage.
Solutions aimed at enterprise and developer adoption, such as Seal Storage and Estuary, are generating clear commercial value. They appeal to institutions that need trustless infrastructure but also demand reliability and SLAs. However, this commercialization comes at a philosophical cost. Projects that prioritize ease-of-use and speed often make compromises on decentralization—introducing gatekeepers or centralized verification processes.
On the other hand, community-focused tools like Lighthouse and Huddle01 remain truer to the decentralized ethos but face adoption hurdles due to complexity or limited resources.
The most widely used applications seem to sit somewhere in the middle, offering APIs and integrations that abstract complexity while keeping decentralized principles intact. This hybrid approach may prove to be the sustainable path forward.
The trajectory of Filecoin reflects the broader journey of decentralized storage: from utopian protocol to pragmatic infrastructure. Its milestones—mainnet launch, FVM rollout, L2 ecosystem growth—map onto the industry's maturation.
Yet, challenges remain. The hardest struggle is maintaining true decentralization while scaling for commercial relevance. Incentivizing storage without bloating the network, onboarding users without compromising the mission, and ensuring interoperability across blockchains—these are not just Filecoin's challenges but those of the entire decentralized storage movement.
Still, with its growing ecosystem, real-world adoption, and expanding developer base, Filecoin is arguably the most advanced case study of decentralized storage in action that we Observe.