Filecoin’s Network Performance in the Second Quarter
In the second quarter of 2024, Filecoin (FIL) experienced a mixed performance in terms of network activity. While there were pockets of growth, overall network performance was lackluster. Factors such as general market bearishness and the impact of the “sell out in May” theory seemed to contribute to the decline in growth.
Disappointing Numbers Revealed by Messari Report
The latest report from Messari shed light on Filecoin’s performance in the second quarter. It highlighted that the active storage transaction volume of Filecoin dropped by 6% compared to the previous quarter. This led to a storage utilization rate of 26%, showing only a 3% increase from April to June. In contrast, the growth rate in the first quarter was at 5% compared to the fourth quarter of 2023.
Positive Revenue Trends but Concerns Linger
Despite the decline in storage transaction volume, Filecoin saw a doubling of total fee revenue to $4 million in the second quarter, up from $2 million in the first quarter of 2024. Additionally, there were over 3,700 unique contracts deployed on the network, contributing to the growth of the Filecoin Virtual Machine (FVM) total value locked (TVL), which reached a record high of $213 million in the second quarter. However, the underperformance of altcoin prices during the quarter raised concerns within the market.
Challenges in Price Recovery for FIL
Between April 1 and June 30, the price of FIL experienced a sharp decline of 55%. Following a period of consolidation from mid-April to mid-June, FIL broke out of a pattern but failed to sustain its momentum. The altcoin struggled to recover, testing support levels at $4.2 and currently hovering around $4.0. Investors and markets are eagerly anticipating a price recovery in the third quarter, but signs of a bullish trend remain elusive.
