The FVM (Filecoin Virtual Machine) is a virtual machine that executes smart contracts on the Filecoin blockchain. It is responsible for managing the execution of code, storing and retrieving data, and enforcing consensus rules. When a smart contract is executed on the FVM, it can directly interact with data on the Filecoin network through the use of state variables. State variables are persistent storage slots that can be used to store and retrieve data on the blockchain. In order to interact with data on the Filecoin network, the smart contract must first specify the storage location of the data. This is typically done by using the CID (Content Identifier) of the data, which is a unique identifier that is used to locate and retrieve the data from the Filecoin network. Once the storage location of the data has been specified, the smart contract can then read or write data to that location by using FVM's built-in functions for reading and writing to state variables. These functions allow the smart contract to directly interact with data on the Filecoin network in a secure and decentralized manner. Overall, the FVM provides a secure and efficient way for smart contracts to interact with data on the Filecoin network, making it possible to build a wide range of decentralized applications on top of the Filecoin blockchain.

The Filecoin Virtual Machine does not work directly with data stored in the Filecoin network; instead, it interacts with the blockchain state data. Data stored in the network can only be accessed and manipulated via secondary solutions such as retrieval networks or other compute-over-data networks, for example Saturn or CoD. These solutions are necessary because access to that data requires both a valid request from the user, as well as an unsealed copy available from one of the storage providers.