A brief analysis of the reasons for the surge in Filecoin prices

This article will share with you why cryptocurrencies rise and fall?

Because during this period, Filecoin will continue to be produced, miners will mine Filecoin, and investors, Protocol Labs, and the Foundation will release Filecoin linearly. The costs of miners, investors, and Protocol Labs need to be borne by the Filecoin produced every day, and they need to sell Filecoin on the secondary market.

Therefore, even if everyone holds Filecoin, new Filecoin will be generated tomorrow, which will dilute the price of Filecoin.

Sideways trading is actually a bullish indicator, but if there is no new money inflow, the price of the coin will fall.

But why didn’t Filecoin go to 0 when it fell?

Because many people in the market are optimistic about Filecoin in the long term, when the price falls, they will choose to buy at a low price and sell at a high price. However, when the price falls, these people rush to grab the low-priced coins, causing other speculators to follow suit, which leads to a rise in the price of the currency.

Currently, Filecoin is in its early stages of development. Since everyone agrees that Filecoin will have a good development prospect in the future, miners and investors who have obtained the coins want to wait for a better price. However, miners who have not yet entered the market need to pledge coins and GAS fees to participate in Filecoin, which has caused a supply shortage in the market.

Coupled with the entry of listed companies and the promotion of the famous domestic media People's Daily, people's awareness of Filecoin is increasing, and more and more people are entering Filecoin by buying coins or mining. The collision between the limited circulation of coins on the market and the continuous injection of new funds has led to a surge in Filecoin.

After the surge, how will Filecoin develop in the future?

We need to understand here that there are many participants in Filecoin, and there are many loyal believers among them. Most of them will pay close attention to the market and stop buying when the price skyrocketed. When a large amount of uninformed funds poured in, they would stop. Waiting for this craze to fade, when miners still have to sell their new Filecoin every day, the price will inevitably fall, and then the "believers" are ready to take out their deposits to buy more Filecoin.

The goal of the Filecoin ecosystem is the entire storage market. At this stage, Filecoin is still in its early stages of development. The system uses block rewards to encourage network capacity expansion so that the entire system has enough storage space to cope with the continuous growth of storage data and ensure network security and stability. In the future, with the access of effective data, the Filecoin ecosystem will once again step into a new level. And the miners who provide storage space in the Filecoin ecosystem will become the "landlords" of future data!