Two pictures explain why Filecoin has strong resilience and how to easily resolve the loss of a large number of QAPs

summary

• Filecoin has anti-fragility mechanisms built into its protocol design, making it resilient to significant QAP drops.

• These mechanisms provide strong economic incentives for new Storage Providers (SPs) to join the network and keep existing SPs in the network after QAP drops.

• In general, after a large number of QAPs have dropped, QAPs that have joined the network will receive excess returns due to the sharp increase in reward concentration, which will restore QAP to normal, demonstrating Filecoin's strong resilience.

As a decentralized data storage network, Filecoin requires SP to determine QAP based on the stored data (whether it is real data) to determine the sector pledge and the amount of block rewards obtained.

Because of this unique structure, we can use the following model to actually verify and see how Filecoin can recover with its strong resilience under the following assumptions of different QAP loss (large number of SP exit).

We can envision two forms of QAP loss:

• When SP sectors expire, SPs slowly leave;

• SPs suddenly shut down and leave, causing a sudden drop in QAP;

  
  

Before interpreting the two model result graphs mentioned above, we need to first understand the premise of this model setting.

Kiran calls this model Agent-Based Model (ABM). The environment of this model implements Filecoin's cryptoeconomic mechanisms (such as the interaction of locking, vesting, minting, and token supply) and satisfies all possible scenarios as much as possible. Including:

3 SP types:

• SPs that only provide Committed Capacity (CC) sectors

• SPs that only provide trading sectors (Fil+)

• SPs that provide both CC and Fil+ sectors

SPs have two types of behavior logic:

• Based on Average Cost - In this model, SPs will join the network with a pre-configured fixed number of sectors and will be continuously renewed until an expiration date, after which the SPs will leave the network (either through QAP expiration or termination).

• Based on ROI - In this mode, SPs will use the FIL-on-FIL Rate of Return (FoFR) forecast to determine how much storage to add, and will start investing if the predicted FoFR is greater than a pre-configured threshold.

There are 4 more initial network states for testing:

• Uniform distribution of CC, Fil+ and mixed SPs

• Only CC and Fil+SP have uniform distribution

• FIL+ skew: 70/30 distribution of FIL+ and CC

• CC skew: 70/30 distribution of CC and FIL+

  
  

Under the premise that the above situations are set to cover most situations, we obtained the following simulation results through the calculation and analysis of the model: (This is only a partial excerpt summarizing the whole point of view, please refer to the original text for the full model report)

The above graph tests the key performance indicators (KPIs) of the Filecoin network under different SPs leaving the network. The dashed vertical line indicates the start of the simulation, and the dotted vertical line indicates the date when sectors begin to leave the network. A baseline case of constant joining using the DCA agent is also simulated to provide a basis for comparison (black dotted line)

From the above figure, we can see that when the SP in the network suddenly terminates the storage contract, the network will experience a sharp drop in QAP. However, we observed that the network QAP began to recover after the termination event. This is because the increase in reward concentration leads to an increase in the FIL-on-FIL return rate.

In this case, we recall the behavior logic of SPs based on ROI. In the current network situation, we can observe that participants who stay in the network will receive high FIL-on-FIL returns. Our simulation reflects this phenomenon. When SPs observe high FIL-on-FIL returns, they will take advantage of this situation and increase storage. Filecoin's network QAP will naturally recover by its characteristics, thus confirming its strong resilience.