Gemini launched wrapped Filecoin last year, allowing traders to commoditize the utility of the Ethereum blockchain-based decentralized blockchain-based alternative to cloud storage. Consider getting exposure to storage as a commodity and being able to use it in smart contracts or other DeFi platforms, and you have wrapped Filecoin (traded as $EFIL). Filecoin operates on its own blockchain, and this is a method of bridging the gap and allowing it to be used on Ethereum.
Gemini has now taken the next step in transforming $EFIL into a DeFi-grade commodity by incorporating it into Chainlink’s Proof of Reserve system (PoR). DeFi platforms will be able to audit the reserves of the Filecoin tokens wrapped and held in custody by Gemini using Chainlink, an oracle. The PoR data feed checks the balances of Gemini’s custody wallet for FIL using a Chainlink-powered oracle network and pushes out an on-chain update if the deviation in Gemini-held FIL balances exceeds a certain threshold.
“Tokenization makes cross-chain representation possible. It enables the value inherent in this segmented utility to be represented in various trading markets, including DeFi. Interoperability will become increasingly important and will be met by solutions such as wrapped assets, according to Matthew Werner, a Gemini Product Manager. “There will be a broader spread of segregated assets as we see more of these types of base chains that provide native utility.”
According to Gemini, the intended goal is for $EFIL to be a more reliable form of collateral and payment across DeFi and other smart contract verticals on Ethereum that require storage solutions.
Apart from DeFi traders, investor interest in Filecoin as an asset is increasing. Grayscale announced the launch of a Filecoin closed-end fund in March. The fund currently manages approximately $580 in assets and has grown by nearly 30 percent since its inception.
Filecoin has stored 27.9 Petabytes (1 million Gigabytes) of data, according to publicly available statistics. Some of this data would be NFTs, but since most NFTs are image files that are only a few megabytes in size, it is unclear what else is in the virtual coffers of Filecoin miners. What is clear is that many of the miners are based in China, which calls into question the storage network’s censorship resistance.
According to CoinGecko, Filecoin’s native token $FIL was trading at $72.35 at the time of publication, up 3% in the previous 24 hours.