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After a rocky start, Filecoin has managed to break into the top 10 cryptocurrencies by market capitalization. After outperforming Chainlink (LINK) and Theta Network (THETA), with a rally of 138% in one week and 418% in one month, FIL took 10th place.
Founded by Juan Benet, creator of the InterPlanetary Files System (IPFS), and developed by Protocol Labs after receiving $ 257 million in its Initial Coin Offering, the platform has managed to attract a lot of attention in China, as reported by journalist Colin Wu.
Data shared by Wu indicates that FIL has seen a 30% increase in its trading volume over the past 24 hours on the Huobi platform. The cryptocurrency has managed to reach a new all-time high based on increased buying pressure and demand for the cryptocurrency.
Daily trading volume was $ 24.2 billion. By contrast, Ethereum’s daily trade volume stood at $ 8.8 billion and $ 7.8 billion for Bitcoin. The rapid rise in price has had negative consequences for investors with short positions, as Wu notes:
FILDOWN, a leveraged short sale token on Binance FIL, plunged 53%, with a turnover of US $ 3.4 billion, indicating a large number of short liquidations of FIL on Binance.
Increased institutional demand for Filecoin
Additionally, Wu recorded an increase in transactions for the FIL / USD pair on Coinbase’s Pro trading service. After FIL’s price surpassed the $ 180 barrier, “transactions with high credibility were recorded on Coinbase,” according to the journalist. Wu added:
Distributed storage has become popular. Filecoin continues to climb to 136U, HOT has risen almost 40% and 2500% so far this year, its market value is close to that of HT, the token of the largest exchange in China.
FIL’s price appears to have increased after the launch of Grayscale’s Trust based on this and other cryptocurrencies to expand its suite of products. Additionally, the teams behind the Filecoin and Livepeer platforms have announced a “co-mining” program. According to an official statement:
Livepeer is launching a joint mining pilot with Filecoin to allow Filecoin miners to become Livepeer video miners while continuing to mine on the Filecoin network storing transcoded video data.
Therefore, the miners of these cryptocurrencies will be able to obtain higher profits and “additional economic opportunities”. The Filecoin mining mechanism requires miners to obtain the FIL token in order to make an “initial offer / response”. The latter has contributed to increased buying pressure for the token.
The demand from businesses and startups to use the Filecoin platform also appears to be accelerating, as indicated by a recent report from his team.
📢 ANNOUNCEMENT: We are less than 1 month from Filecoin Frontier Accelerator #DemoDay with @LongHashVC! See 11 blockchain startups using Filecoin’s storage and distribution network at 9am (GMT + 8) on April 23.
RSVP here: https://t.co/uiNPYQLdxY
– Filecoin (@Filecoin) April 1, 2021
Trader Fiskantes believes the currency is “grossly overvalued” and could see a 90% drop. This is mainly based on the increased supply of FIL which will double in the next 3.5 years. However, the large number of partnerships and the interest of China could contribute to the prolongation of the rally of this token. As of this writing, FIL is trading at $ 190 with a 3.8% gain in the last 24 hours.
FIL shows small gains on the 24-hour chart. Source: FILUSDT Tradingview
