TL;DR: Filecoin is a hybrid proof of stake and proof of capacity based consensus network. Storage Providers stake FIL when adding storage to the network. Regularly sending ZKProofs for locked capacity allows them to validate epochs on the network. Mining rewards, including transaction fees and newly minted Filecoin, can be earned. If storage providers fail to publish capacity proofs for their staked FIL, they will lose the collateral, similar to normal deals.

Filecoin is a decentralized network that utilizes a combination of proof of stake and proof of capacity consensus mechanisms. This hybrid approach ensures the security and efficiency of the network.

In Filecoin, Storage Providers are required to stake FIL (Filecoin's native cryptocurrency) when they add storage to the network. This stake serves as a commitment and provides an incentive for the Storage Providers to fulfill their responsibilities.

To validate epochs on the network, Storage Providers must regularly send Zero-Knowledge Proofs (ZKProofs) for their locked capacity. These proofs demonstrate that the storage is still available and accessible. By doing so, Storage Providers gain the authority to participate in the consensus process and earn rewards.

Mining rewards in Filecoin come in the form of transaction fees and newly minted Filecoin. Storage Providers have the opportunity to earn these rewards by actively participating in the network and providing reliable storage services.

However, it is important to note that if Storage Providers fail to publish capacity proofs for their staked FIL, they will lose the FIL that they have posted as collateral. This loss of collateral is similar to the consequences faced in normal deals.

Overall, Filecoin offers a unique approach to decentralized storage, combining proof of stake and proof of capacity to create a secure and efficient network. By actively participating and fulfilling their responsibilities, Storage Providers can earn rewards in the form of transaction fees and newly minted Filecoin.