Klaytn and Filecoin Defy Feds' Crackdown With Big Gains

'China Narrative' May Be Boosting Certain Tokens

By: Owen Fernau Loading...

Klaytn and Filecoin Defy Feds' Crackdown With Big Gains

Not all crypto sectors have been dampened by the recent barrage of regulatory action coming out of the U.S. this week.

KLAY, the native token of the Klaytn, a blockchain whose team is positioning as a metaverse-oriented platform, was up 23% ion Friday and 62% in the last seven days, according to CoinGecko. That’s the largest gain of any of the largest 100 digital assets in that time span.

China Narrative

FIL, the token used in Filecoin, a decentralized storage network, is the second largest gainer, having jumped over 14%. It boasts a market cap of $2.9B.

Andrew Kang, partner at Mechanism Capital, told The Defiant that KLAY and FIL’s momentum appear to be getting a boost from what he dubbed the “China narrative.”

“Filecoin is massive in China,” he said, adding that the chart for the token was “very attractive for traders.”

The investor mentioned other tokens, including Polkadot’s DOT, Dfinity’s ICP, and veChain, VET as other parts of the narrative, on Twitter. Kang doesn’t expect the focus on China-oriented tokens to last more than a week or so.

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Another token for a decentralized storage network, AR of Arweave, was up 18% on Friday, indicating that the crypto may be taking a broader interest in the sector.

Crypto has seen certain subsectors pump out of the blue in recent months — tokens loosely categorized as “aritificial intelligence tokens” had a major move last week. It may simply be that storage tokens are crypto’s flavor of the week as traders try to turn a quick profit.

And cloud storage is a major sector — the space raked in $217B from September 2021 to September 2022, according to a report by Statista. A network taking a piece of that action away from the clear leaders in the space, Amazon, Microsoft, and Google, would be a major success for any blockchain-based storage platform.

New Use Cases

There are some fundamental changes coming up for Filecoin, which may help the project gain traction — Filecoin is touting the imminent launch of “Filecoin Virtual Machine,” (FVM) on Twitter.

The FVM will bring smart contracts to the Filecoin blockchain which may open up a host of new use cases for the network —use cases include granularly controlling who has access to certain files, the ability to automate deals to store files, or enabling data-oriented decentralized autonomous organizations (DAOs), according to the FVM’s documentation.

Filecoin raised a massive $257M, in an initial coin offering (ICO) in September 2017.

Outside of China-oriented trends and storage solutions, Kang of Mechanism, thinks the overall market is looking up — the investor said that BTC entering the $30,000 to $40,000 is likely, but didn’t give an exact time frame for the prediction.

“Institutional capital and retail haven’t come back in yet,” he said.