Filecoin climax
At the beginning of 2023, Filecoin issued an article to share three major changes this year, namely updates to FVM, data computing and retrieval markets. These updates quickly attracted widespread market attention after their release.
Especially on March 14, Filecoin officially launched FVM. This change caused a major change in Filecoin's valuation model.
Before the launch of FVM, Filecoin’s valuation was only equivalent to the upper limit of its storage capacity and faced competition from numerous storage projects. The birth of FVM allowed Filecoin's valuation model to achieve a dual superposition of storage and public chains.
In short, the status of FVM in Filecoin is comparable to that of EVM in ETH. With FVM, developers can easily build various DEFI, applications, and decentralized storage computing on Filecoin, and achieve rapid testing and deployment.
It is worth mentioning that FVM is fully compatible with Ethereum’s EVM, which allows developers to write smart contracts using Solidity and other Ethereum-compatible programming languages. Such excellent compatibility provides developers with the possibility to easily migrate existing Ethereum-based dApps to the network. Moreover, FVM also has significant advantages over the Ethereum Virtual Machine, such as shorter execution time and lower gas costs.
Under FVM’s expectations, the growth of Filecoin protocol revenue and total locked value (TVL) will be significant in the first quarter of 2023. DeFiLlama data shows that the Filecoin network performed steadily in the first quarter, with protocol revenue increasing by 5% quarter-on-quarter and a growth rate of 21%. At the same time, TVL on Filecoin more than doubled, reaching an all-time high of $3.15 million on February 21.
Dilemma remains
However, after FVM went online, although the authorities continued to release favorable policies to support LSD liquidity pledge and computing power mechanism reform, the price of FIL did not continue to rise. There are many reasons behind this.
There are many early miners in the market who have invested a lot of money in purchasing mining machines and hold a large number of FIL coins at market highs. The FIL mined by these miners will be released linearly within 180 days. When the market performs well, they are often eager to sell to recover their costs.
Compared with traditional storage solutions, Filecoin's decentralized storage technology still needs time to develop and improve. Large enterprises and organizations usually choose mature and stable technologies and services. Filecoin may not be able to compete with traditional cloud storage services in terms of performance and speed for the time being.
In terms of mode and gameplay, recently, Filecoin launched LSD liquid pledge to encourage users to participate in liquidity mining to a certain extent, and improve the liquidity of FIL tokens in the market. However, this approach only treats the symptoms and not the root cause. If the application consumption cannot keep up, the circular pledge will increase market circulation and bring pressure to the secondary market. The packaging upgrade (CC to DC) makes the chips more concentrated in the hands of large miners.
The official policy of expanding the computing power of existing mining machines means that ten times the amount of FIL coins will be needed for mining machine packaging, which will have a certain positive impact on the deflation of the entire FIL. However, for small and medium-sized miners, this policy means that they will face rising costs for computer rooms and electricity prices, as well as dealing with unpredictable policy risks.
The key to sustained growth
Looking at the early development of Ethereum, Solana, and Avalanche, they often relied on increasingly rich and mature product structures to obtain huge transaction volumes and liquidity, and quickly became the absolute protagonists on the public chain stage. However, as the competition in the cryptocurrency market becomes increasingly fierce, users are more mature than in the early stages of the industry. Public chain project parties have realized that they can no longer gain a foothold in the industry by relying solely on some dazzling gameplay. They must actively develop the ecosystem down to earth to remain invincible.
At present, in the public chain ecosystem, whether it is wallets, DEX, games and other applications, or mining, cross-chain, and custody, the relationship between each other is becoming closer and closer. Only an ecosystem based on a public chain can combine everything into a whole, support each other, and be interconnected, which will bring greater market competitiveness to the ecological layout.
From this point of view, it is not difficult to understand that the core of Filecoin's future development lies in the construction of an ecosystem based on the public chain. Filecoin should take advantage of the launch of FVM and decentralized storage to actively develop and support ecological construction, and should focus on the growth of application use cases, effective data, retrieval markets, and virtual machine ecosystems, which are related to the future of Filecoin.
We expect that as the ecosystem develops and takes root, Filecoin will become a layer-1 public chain similar to ETH, BSC, etc. The pledge rate of FIL is expected to increase further, and the market price will receive real application support.
Themis, the leader of Filecoin ecosystem
In the past few months, more than 150 development teams have begun to deploy FVM products and services on the Filecoin mainnet, and Themis is one of them. Thanks to the product model and the team's strong execution, the Themis protocol has quickly become popular in the Filecoin community and has received great attention from more than 16,000 developers and miners in the Filecoin ecosystem.
According to the data, Themis Pro, the core product of Themis protocol, is a decentralized spot and derivatives trading aggregation platform based on Ve(3,3) on FVM. Its products have the advantages of zero slippage trading mechanism, strong platform revenue feedback ability and high capital utilization rate.
The price of Themis treasury fund pool is not regulated by the xy=k formula, but by obtaining prices from the top CEX through the ChainLink oracle to achieve "zero slippage". The benefit of zero slippage trading to Themis Pro (0x,f4) is obvious, that is, ultra-high leverage has been implemented on the perpetual contract platform with low liquidity. Even when the on-chain TPS is not high, users can obtain real-time prices based on the depth of centralized exchanges, in exchange for a better trading experience and avoid unnecessary losses caused by slippage.
At the same time, Themis Pro has also realized full-chain contract trading of derivatives. In particular, with the help of the user-friendly FVM ecosystem, Themis Pro can achieve the same trading experience as CEX and avoid trading losses caused by contract trading delays.
Themis Pro also has a very important reward mechanism: 70% of the platform's revenue is used to repurchase $THS. This repurchase strength ensures the platform's token THS's super value capture ability, thereby promoting the rapid development of the community.
In March this year, the Themis team announced that it would actively develop the Filecoin ecosystem, focusing on FVM and striving to become the leader of Filecoin, including:
Themis Labs has built the first The Graph node for the Filecoin Virtual Machine (FVM), which other developers can make full use of to obtain on-chain data, query network status, etc., making it easier to develop and deploy decentralized applications based on Filecoin.
The core product Themis Pro is already a mature decentralized spot and contract exchange for asset exchange. The innovative mechanism can effectively increase the number of FIL lock-ups, thereby increasing its value. By providing more trading pairs and trading products, Themis Pro is expected to attract more users to participate in the Filecoin ecosystem.
Themis will build an automated market maker (AMM) type DEX on FVM to meet the needs of different user groups. This will further enrich the application scenarios of the Filecoin ecosystem and improve the practicality and circulation of FIL tokens.
Themis protocol also plans to issue an asset-reserve USD stablecoin based on FVM, similar to DAI. FIL users can use FIL as collateral to mint this USD stablecoin. This will greatly increase the circulation value of FIL while providing users with a hedging and payment tool.
Themis will open LSD business based on its own pot price adjustment mechanism and eight-hour compounding mechanism, and launch FIL Pool product, namely liquidity pledge service, which provides a novel and innovative solution, that is, users can participate as suppliers, provide liquidity to the market to earn passive income, and SP can borrow in the form of over-collateralization to improve capital utilization and maximize value capture for FIL pledgers and SPs. This move is expected to encourage more users to participate in the Filecoin ecosystem and further increase the locked volume and value of FIL.
Storage, retrieval and computing are the infrastructure layer of the Filecoin ecosystem, which is an underlying advantage that other public chain ecosystems cannot match. However, the infrastructure layer has a long development and profit cycle, which is not enough to support the further development of Filecoin in the current market environment. The financial layer built on the infrastructure layer is the key to the prosperity of the Filecoin ecosystem and a powerful driving force for the rapid development of the Filecoin ecosystem. Similar to the economic development of a country, the vigorous development of industry, agriculture and the tertiary industry requires the central bank's monetary policy to make macro-control. Commercial banks, as the executors of the central bank's monetary policy, rely on a complete financial system to drive the development of various industries.
As an innovative DeFi protocol that integrates the advantages of Cruve, Olympus, and GMX, Themis practices LAAS (Liquidity-as-a-Service), which is an innovation of liquidity mining that ignited the summer of DeFi in 2020, and provides a new set of liquidity incentives and retention solutions. Compared with liquidity mining, LAAS ensures sustainable liquidity while adjusting long-term incentives for investors.
Based on a comprehensive and accurate analysis of the Filecoin ecosystem, the team's experience, knowledge and technical capabilities in the DeFi field, and the advantages of the protocol itself, the Themis protocol is fully qualified and capable of becoming the cornerstone of the Filecoin ecosystem's financial layer. Themis vault contracts, minting contracts, bond contracts, and subsequent stablecoin contracts can be understood as the central bank role of the Filecoin ecosystem. The pledge contract, LSD business, AMM exchange Themis Swap, and the universal spot and derivatives exchange Themis Pro will assume the role of the Filecoin ecosystem commercial bank, providing SPs, various applications, and FIL holders with a steady stream of liquidity and trading scenarios.
As the Filecoin ecosystem continues to develop, the Themis protocol will become an important part of cultivating a robust and prosperous FIL-DeFi ecosystem.
at last
As the first phenomenal application of the new public chain, it is the most attractive to investors. For example, Treasure Dao and GMX on Arbitrum have brought real traffic and TVL value support to the Arbitrum ecosystem. In turn, Arbitrum provides more support to the project in terms of technology and publicity. Judging from the fact that Themis recently announced that it has obtained strategic investment support from early investors in the Filecoin-related ecosystem, as well as the interaction between Filecoin official Twitter and Themis Pro, it is clear that the Themis protocol has already been officially recognized and supported by Filecoin.
2023 is the year of Filecoin ecosystem. The development roadmap of FVM will continue to be improved and optimized to achieve more efficient, safer and richer functions. With the continuous development and improvement of FVM, the Filecoin ecosystem will become more complete and powerful. Which project can become the leader of Filecoin ecosystem? Let us wait and see.
