Filecoin saw record shorts over the weekend, as it’s down 28% over the past five days, while Storj is down 20% in the same time period.

Short sellers were relentless on storage protocols Filecoin (FIL) and Storj (STORJ) over the weekend, with record shorts being placed on FIL.

FIL is down 28% over the past five days, with STORJ down 20%. Both have underperformed ether (ETH), which is down roughly 10% during the same time period.

Data from CoinGlass points to record liquidations on long positions for FIL and STORJ as last week came to a close.

Nearly $5.7 million long FIL positions were liquidated on December 16, according to CoinGlass, while $365,000 in STORJ long positions were also liquidated. Internet Computer (ICP), a similar protocol, also had $500,000 in long positions liquidated.

Open Interest data from CoinAlyze suggests the worst is yet to come, with an 11% jump in open interest during the last 24 hours to about $52 million. Continued negative funding rates indicate that this money is coming in to short.

Traders might be questioning the utility of storage protocols, which have a massive — and growing — storage capacity but no obvious use case to utilize it.

Filecoin says it has a capacity of 15.34 Exbibytes, or 17.6 million Terabytes, but lists storage of OpenSea NFTs as one of its primary clients, raising questions about how much of its storage network is truly utilized.

On OpenSea, monthly volume dropped to $159 million from around $4.8 billion at the start of the year, a decline of about 97% and nearly reflective of Filecoin’s decline from $236, when it listed on April 1, to $3 today.

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The industry organization is led by Filecoin creator Protocol Labs.

Protocol Labs, the company behind the decentralized file-sharing protocol Filecoin, announced an alliance that aims to help more companies make the transition to Web3 from Web2.

The industry organization has a trio of heavy-hitters as founding partners: computer hardware giant Advanced Micro Devices (AMD), storage device maker Seagate, and Big 4 accounting and consulting firm Ernst & Young (EY).

Filecoin essentially allows users to buy or sell computer storage on a network that offers decentralized storage of data and files. The service is meant to act as an alternative to centralized storage providers like Amazon Web Services.

The Decentralized Storage Alliance, launched in conjunction with the nonprofit Filecoin Foundation, will work to establish development standards that would help decentralized storage solutions meet the needs of enterprise customers, including making it easier for data centers to onboard onto a decentralized network. Working groups will be created to solve other specific issues that could slow the transition from Web2 to Web3.

“As the global data and storage markets are accelerating, there is a lag in the adoption of decentralized storage technologies,” James Canterbury, partner and principal at EY Blockchain, said in the press release.

The founding partners aren’t new to the crypto space. AMD’s central and graphics processing units (CPUs and GPUs) have long been used by crypto miners. Seagate experienced a sales surge last year due to Chia, a blockchain that utilizes the unused computer storage space of miners to validate the network. EY announced a partnership with the Polygon protocol in Sept. 2021 to deploy its own products on the Ethereum blockchain. The first of those products – a supply chain manager – launched earlier this year.

“We see decentralized storage as an opportunity to diversify and add resilience to our data infrastructure,” Canterbury continued. “And we see the alliance as a crucial piece of this – enabling adoption of decentralized storage and cohesion across the broader industry.”

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Some 20,000 individual users are said to be using Filecoin to store over 50 million data objects used by dApps.

Decentralized filesharing protocol Filecoin saw a nearly sevenfold growth of data suppliers since the start of 2022, ahead of plans for a major upgrade in early 2023.

At the FIL Singapore event on Monday, attended by CoinDesk, Colin Evran, co-lead at Filecoin development lab Protocol Labs, said the network’s storage providers were increasing at a rate of 20% each month, with most activity in North America, Korea and Hong Kong. Evran said that some 7,000 new developers were currently building applications on the Filecoin blockchain.

Filecoin (FIL) is a cryptocurrency that enables users to buy and sell computer storage on a system for decentralized storage of data and files. The latter is said to help support a truly decentralized ecosystem, where blockchain data itself is stored on networks such as Filecoin, instead of centralized providers such as Amazon Web Services (AWS).

Protocol Labs founder Juan Benet said some 20,000 individual users were currently using Filecoin to store over 50 million data objects, all of which are used to run decentralized applications (dApps). A data object is a storage term that denotes a value or group of values that help any system to operate.

Such reported growth comes ahead of the launch of the Filecoin Virtual Machine (FVM), slated for an early 2023 release. FVM is a software platform, or “virtual computer,” that would be used by developers to create decentralized applications (dApps) based on the Filecoin network.

Protocol Labs head of development Molly Mackinley said a testnet, or a testing blockchain that mimics real-world usage, was due for a November 28 launch. Mackinley added prototypes for layer 2 – or individual blockchains that run atop the main blockchain – were already in initial testing phases and would allow for a more scalable Filecoin network after launch.

FIL has a market capitalization of over $1.6 billion as of Monday morning and is up a nominal 1.1% in the past 24 hours.

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