Question 1

What is Siacoin?

Accepted Answer

Siacoin (SC) is the primary currency of the Sia network and the payment asset used to form file storage contracts. Renters use SC to purchase storage, while storage providers earn SC for storing data and proving its continued availability. SC is also used to issue block rewards and Siafund dividends; it therefore participates both in storage-contract payments and in other settlement and distribution scenarios defined by the protocol.

Question 2

What role does SC play in the Sia storage process?

Accepted Answer

When using Sia for storage, an application first encrypts files and their metadata locally, then erasure-codes the data, splits it into redundant shards, and uploads the encrypted shards directly to multiple independent storage providers. Keys remain with the user, and storage providers do not see file names, object identifiers, or plaintext contents. SC is the unit of account for contracts and services in this process: SC is needed to form storage contracts and upload data; providers earn SC for storing shards and proving availability. Distributing data among multiple providers is intended to reduce the risk that a single operator or single point of failure affects availability and privacy at the same time.

Question 3

How do Sia file contracts work?

Accepted Answer

A file contract is a storage agreement between a renter and a storage provider that is executed by the blockchain. It enables parties who do not know each other to agree on storing data without relying on mutual trust. In the current architecture, the indexer forms, maintains, and renews contracts on behalf of the application, and tracks shard locations and health; storage providers are responsible for storing the data. A provider is compensated only after proving that it successfully stored the data for the agreed period, so “forming a contract” and “ultimately receiving storage compensation” are different stages.

Question 4

What makes up the SC cost of using Sia storage?

Accepted Answer

Sia storage costs consist of several components: first, the price set by storage providers for storage services; second, a one-time contract-formation transaction fee for creating an on-chain storage contract; and bandwidth fees for uploading or downloading files. Some providers may also charge fees related to hardware wear and tear. Prices are denominated in SC, and providers can set their own prices. A renter's actual cost therefore depends on the selected providers' prices, the number of contracts formed, the storage duration, and the bandwidth used for uploads and downloads; it cannot be understood simply as a single “monthly storage fee.”

Question 5

Why can storage providers earn SC?

Accepted Answer

Storage providers run hostd, contribute disk space and bandwidth, store encrypted shards, and continually prove that data remains available; only after meeting the storage-period requirements do they receive SC for the corresponding storage service. This ties host income to performance: simply declaring that space is available does not earn compensation. Official documentation also explains that the market is formed jointly by providers and renters, with providers setting their own prices and renters choosing between price and service quality.

Question 6

How is SC issued and denominated?

Accepted Answer

SC is issued through block rewards. The official current learning page states that each block produces 60 KS; KS means kilosiacoin, or 1,000 SC, so this rule corresponds to 60,000 SC of new issuance per block. The smallest unit of SC is the hastings: 1 SC = 10^24 hastings. Sia represents SC values with 128-bit integers, which sets an upper limit of about 340 TS on the total representable supply; however, under the 60 KS-per-block rule, official documentation says it would take more than 100,000 years to reach that limit. This upper limit is a boundary of numerical representation and should not be misconstrued as a circulating amount that will be reached in the near term.

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