Table of ContentsToggle
- One of the most prominent blockchain based solutions for the decentralized storage – Filecoin has seen a major fall of over 30% and is currently trading just under $3 as of writing.
- Not just that, in the month of December 2022 alone – FIL price has lost nearly 40% of its market capitalization and lost over half its value between the months of November and December 2022.
- Filecoin, despite having had a very strong value proposition and a unique use case – FIL price has been under a lot of pressure this year.
Filecoin is a blockchain network that works as a decentralized, peer-to-peer digital storage marketplace. It is built on the IPFS or the InterPlanetary File System and enables users to rent out unused hard disk space to earn FIL tokens in return.
This platform also enables other people who are in need of extra storage space to purchase that for a fee through a decentralized system on the Filecoin network. Thus, instead having to depend on a single centralized company with important data – it can be split up and stored on different computers across the world ensuring higher security.
Additional read: What is Filecoin?
FIL TECHNICAL OVERVIEW
FILECOIN SOCIAL DOMINANCE AT A YTD HIGH!
Despite extremely bearish technicals on the price chart, FIL’s social dominance seems to be improving drastically. Filecoin’s social dominance is at an year-to-date high as is depicted on the chart above, according to data from Santiment. This indicates there has been a substantial increase in the internet chatter about this particular crypto project.
Read More: Filecoin | Top Web3 Tokens By Market Cap
WEIGHTED SENTIMENT ALSO IN THE POSITIVE ZONE
To further add on to the observation made above – the weighted sentiment for the Filecoin crypto project is also in the positive zone, which came in tandem with the major spike in the social dominance of the token. This indicates that a larger portion of the social volume and chatter is on the positive side and indicates that some pullback could quickly occur in the token.
Weighted sentiment is an indicator that measures positive and negative social volumes and displays it in a charted format. A major spike in either direction indicates that there is increasing social volumes – however a positive figure indicates that the chatter is largely positive while a negative spike indicates increase in negative chatter.
FILECOIN DEVELOPMENT ACTIVITY ALSO HOLDING STRONG
FIL’s development activity is also holding very strong despite the extremely poor price action as discussed above. Infact, in the last two months alone, FIL’s development activity has noted a significant jump of nearly 200% at the local highs before receding slightly. This indicates that the developers behind the project are active and improvements to the project will be timely and predictable and thus better for the overall project.
Thus in conclusion, judging from the on-chain metrics we discussed about, ranging from improving social dominance and weighted sentiment and a very optimistic looking development activity – things on the fundamental front looks quite positive for the Filecoin ecosystem. However, on the flip side, technical factors are weighing in heavily on the bearish side, with prices touching all-time-lows on the chart. Hence while the project and its use cases remain strong and unique, investors need to be careful and do a lot of research and keep risk management in mind before investing in FIL at the current juncture.
Prices as on 21 December, 2022.
Bitcoin price has surged just under 50% in February 2024 alone!
BlackRock’s Bitcoin ETF hits $1.3B daily volume, signalling market surge.