Filecoin is one of the unique projects in the cryptocurrency space, as it uses its blockchain to secure and manage the network. $FIL is a native token of Filecoin, an ERC-20 token. It is a peer-to-peer network that allows users to store files using the Filecoin blockchain and pay the storage miners in $FIL.

This project is unique because of its peer-to-peer feature, censorship, and robust storage system. The Filecoin aims to “store humanity’s most important information.” The project raised $205 million in investments from its initial coin offering (ICO).

The token performed excellently in the previous bull run in 2021. However, it has failed to impress with its performance in the last four years in the cryptocurrency space. This article will explore why Filecoin is not performing and its future in cryptocurrency.

How is Filecoin 90% Down After Hitting ATH of $233?

$FIL reached a monumental all-time high of $237.24 in April 2021. The token plummeted by over 97% since that day. Not only Filecoin but all other altcoins were in the same situation because of the bearish sentiment in the cryptocurrency market. The primary reason for this is Bitcoin's massive move. However, the token has failed to perform well in the current bullish season compared to other cryptocurrencies that are not well-known and less secure than the Filcoin network.

$FIL reached a monumental all-time high of $237.24 in April 2021, 40x higher than now.

$FIL reached a monumental all-time high of $237.24 in April 2021, 40x higher than now.

Filecoin currently has 23 EB of storage available for users, who use it to store their documents, movies, and many other things. However, only a small number of users are occupying the space. This highlights that decentralized storage holds immense potential, but market demand remains largely untapped. This means that slow growth is one of the reasons behind its low performance.

The supply and demand for FIL have become an issue as well. The economic model for this project relies on miners who are staking FIL tokens to provide storage to the users. The current supply of FIL tokens surpasses the demand of the users. 300,000 tokens are sent over to the market every day by Protocol Labs and the FIL Foundation. This continued supply of tokens has become an obstacle to growth for FIL tokens.

Along with this, Filecoin also faces some technical issues. The project only supports cold storage data. Cold storage data is not frequently accessed for a long time; these are usually backups and data archives. However, investors often look to store data that they access daily.

Filecoin's peer-to-peer data storage capability has many advantages. However, users still rely on centralized storage solutions rather than decentralized ones, such as Google Cloud Storage and AWS. These centralized storages certainly have better technical support than Filecoin.

The only solution to overcome this is to educate the audience about the mechanism behind Filecoin and its goals. In addition, Filecoin's revenue primarily comes from miners' pledges, transaction fees, and penalties for non-compliance. While these sustain network operations, they don't reflect enterprise payment for storage services. The project must focus on increasing enterprise storage payments to ensure long-term growth and a stable FIL price.

Filecoin 2024 Annual Report: What’s New For 2025?

On January 13, 2025, the Filecoin community unveiled its 2024 annual report and its next goals for 2025. The report highlights the project’s significant impacts towards enhancing user security and technical issues.

The report shows 9,550 teams have supported the Filecoin ecosystem in different orders. 250 teams supported the ecosystem through FF funding and grants, while 8,800 teams helped build the project ecosystem, and 500+ teams supported Filecoin hackathons.

Currently, the Filecoin Foundation is working on building a Layer-1 ecosystem to foster decentralization and a vast section of the Web3 world. They have collaborated with two blockchain giants, Cardano and Solana.

Filecoin and Blockfrost have shaken hands in integrating Filecoin decentralization storage features for Cardona applications, which were developed on Blockfrost. This partnership will strengthen data redundancy, improve quality assurance, and enhance the decentralization of Cardano applications.

The Filecoin Foundation also supports Solana block history, stored on Filecoin, by collaborating with Triton ONE and DCENT. The Filecoin Foundation has mentioned working closely on its product and achieving its objectives. They are keen to work on KR (Key Results) and ecosystem objectives in 2025.

The first KR is to increase the network storage PIB to five daily. There are currently 7 KRs they are focusing on in 2025. This could greatly improve the overall condition of the Filecoin network and help FIL token growth.

How to Trade FIL/USDT on CoinEx?

CoinEx supports $FIL trading pairs with $BTC, $USDC, and $USDT. In order to make your trading, you first need to register your account. Follow the steps below:

After you register your account, verify it with your ID card or passport.
Transfer funds into your spot account. You can use various methods, such as transferring from a wallet or using the P2P feature on CoinEx.
Search for FIL/USDT pair.
Select the number of coins you want to buy.
Buy at market price, or you can set a limit.
Add a stop-loss limit to prevent losses.

If you are a beginner, it is advised that you prevent future trading and focus on spot trading, as it is less risky than future trading.

Conclusion

The Filecoin Network's recent collaborations and upgrades indicate that the project and its community are trying to grow their token and ecosystem. However, the price has not performed well in this current bull season of the cryptocurrency market. The holders are patiently awaiting a good response from this token in 2025.

Disclaimer: Please note that the information provided on this website is intended for informational purposes only. CoinEx assumes no liability for any financial losses resulting from cryptocurrency trading. It is advised that you conduct your own research.

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