Key takeaways

  • Filecoin (FIL) enjoys rising demand throughout 2023 as Messari reports +45% QoQ increase to active storage deals
  • FIL had previously been in a sustained downtrend since its 2021 all-time high but continued growth in the rate of adoption for its decentralized storage protocol can be seen as a bullish catalyst
  • FIL recently broke above its 21-weekly EMA and algorithm now predicts +126% price increase within the next three months

Filecoin achieves continued ecosystem growth for a fifth successive quarter

Some key Filecoin (FIL) performance statistics have been revealed that show a marked increase to the network’s rate of adoption. Since Q3 2022, Filecoin has enjoyed consistent growth, according to Messari’s State of Filecoin report. This has led to a bullish price prediction for the native FIL token, with an algorithm forecasting a +126% gain by Q1 2024.

Right now, FIL is valued at $3.85 per token — up +31% since its August low. This follows a period of extreme downside for the cryptocurrency in which FIL lost -98% of its value between March 2021 and December 2022. The recent uptick may signal that a trend reversal is ongoing, with FIL breaking above the 21-week EMA in the past 7 days.

FIL breaks above resistance on the weekly time frame, via TradingView

Demand for Filecoin storage rises +45% in Q3, storage utilization hits 12.6%

Filecoin shared some of its recent successes on Twitter, including a +45% QoQ increase to active storage deals. This metric is the most direct demand measure for Filecoin’s decentralized storage solution, as it records the number of peer-to-peer (P2P) transactions for Filecoin-based cloud space.

The demand for Filecoin storage shot up by 45% in Q3 2023.

In its latest report, @MessariCrypto breaks down the current state of Filecoin. Here are top 5 questions on Filecoin’s performance ⏬

1⃣What does demand look like for Filecoin storage?

The amount of data stored in… pic.twitter.com/78sIaPq1C9

— Filecoin (@Filecoin) October 26, 2023

Not only did the total number of FIL transactions grow due to higher demand for decentralized storage space, but this has also led to a marked increase to storage utilization for the entire network. As of Q3 2023, Filecoin was operating at 12.6% of its total capacity compared to just 7.6% in Q2 and 4.1% in Q1.

The increased rate of usage for Filecoin led to $3.1 million of revenue generated by the protocol and more than $56 million of revenue generated for its users. Filecoin’s financial incentives are a key selling point over alternative decentralized P2P storage solutions such as IPFS, so maintaining a high figure for supply-side revenue can be seen as another major success for the project.

Key Filecoin performance metrics, showing increased QoQ statistics across the board

Algorithm predicts +126% surge for FIL by January 2024

The recent breakout from the lower side of FIL’s macro range represents an incremental improvement to its overall price action since 2021, however an algorithm has recently forecasted that it could mark the beginning of sustained bullish price action.

The algorithm has predicted that FIL will climb a further +126% to hit $8.71 within the next 3 months. If FIL can successfully climb to this price level, it will have breached its 2023 high in a move that could signal further upside on longer time horizons.

While FIL is expected to retrace shortly after hitting the $8.71 level, the algorithm does not expect it to revisit its recent lows at any point in the next few years.

Bottom line: FIL becoming a popular solution for decentralized P2P storage and still has room to grow

Filecoin’s recent successes highlight that demand for decentralized storage space has been increasing in 2023. Within the context of cloud storage, Filecoin offers a unique solution due to its highly secure blockchain infrastructure and in-built financial incentives for storage providers.

Over time, Filecoin may seek to increase its total storage utilization even further. The 12.6% utilization rate for Q3 2023 means that Filecoin is almost at 1/8th capacity, which shows the scope and scale for how demand could increase further over time.

For now, FIL remains towards the lows of its macro price trend but the recent break above the 21-week EMA signals further upside potential. The price algorithm’s bullish forecast could provide an attractive trading set-up, with short term volatility expected to boost the value of each FIL token by more than 2x.

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