ChainStorage6 (CSTO) Index | What’s Next for the Blockchain Infrastructure Pillar?
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As we all know, blockchain storage is a critical component of the Web3 infrastructure and has become increasingly popular in recent years. In order to better track the performance of the storage industry, I’ve created the ChainStorage6 index using InCre. The CSTO index provides valuable insights into industry trends and performance metrics, which can be used to make informed investment decisions.
ChainStorage6 (CSTO) Index Construction
Tokens Selection Intro
The ChainStorage6 (CSTO) Index is composed of six storage projects, including Filecoin ($FIL), Arweave ($AR), Internet Computer ($ICP), Holo ($HOT), Siacoin ($SC), and MaidSafeCoin ($MAID).
Filecoin ($FIL) and Arweave ($AR) have become representative projects of decentralized storage, with Filecoin boasting a market cap of approximately $1.3 billion, which accounts for over 21% of the total Mcap of the ChainStorage6 (CSTO) Index. Arweave has also gained popularity with a market cap of approximately $930 million and a total value locked (TVL) of $1.2 billion.
Internet Computer ($ICP) integrates storage and cloud computing and has a market cap of approximately $920 million and a TVL of $850 million. Meanwhile, Holo ($HOT), Siacoin ($SC), and MaidSafeCoin ($MAID) are potential small market capitalization projects within the CSTO Index.
Equal Weight Method
The ChainStorage6 (CSTO) Index uses a capped-weighted method with a cap limit of 20%, resulting in almost equal initial weights for the 6 tokens. Initially, 4 tokens ($FIL, $ICP, $HOT, $SC) had a weight of 20%, while Arweave ($AR) had a weight of 15.97% and MaidSafeCoin ($EMAID) had a weight of 4.02%.
However, the weight of some tokens has changed significantly since then. Currently, the weights of $AR and $FIL have exceeded the initial weight limit of 20%, with $AR at 34.09% and $FIL at 26.43%. This change indicates that these two projects have experienced substantial market capitalization growth, which may be attributed to their popularity and innovative solutions in the decentralized storage industry.
ChainStorage6 (CSTO) Index Performance
As of February 28, 2023, the ChainStorage6 (CSTO) Index sits at 35.86, a -7.79% change in the past 24h, but still an impressive 76.04% increase since its inception in 2023.
The index started its ascent in 2021 after its base date in May, hitting an all-time high of 198.87 points in November 2021. Throughout 2021, the storage index showed strong performance, with points consistently above 105.
However, in 2022 the index trended downward, dropping from 133 to its current level of 35. The ChainStorage6 (CSTO) Index’s decline can be attributed to bearish market sentiment and specific events impacting individual projects.
For example, in August 2022, Filecoin ($FIL) experienced a significant drop in price after China’s regulatory crackdown on cryptocurrency mining operations. This had a knock-on effect on the CSTO index, as $FIL was one of the highest weighted tokens in the index.
Arweave ($AR) also saw a sharp drop in price in September 2022 after a hack on the platform that led to the loss of approximately $8.3 million worth of tokens.
Furthermore, the storage industry has become increasingly competitive, with new projects entering the market and vying for market share. This has put pressure on established projects like $FIL and $AR, and contributed to the overall decline in the CSTO index.
Key Constituent(Token) Comparation: What’s Next?
Decentralized storage has been a crucial aspect of the Web3 infrastructure, providing secure, efficient, and affordable storage solutions. As of February 28, 2023, the total market cap of the storage industry is around $5.98 billion, with a 24h TVL of $2.1 billion. However, with strong players such as Filecoin, ICP, and AR dominating the market, it raises the question: what’s next?
To compare the performance of these three key storage projects, we looked at their revenue, FDV, and market dominance.
Filecoin, the first project to develop a decentralized storage network, has a market cap of $2.15 billion, with an FDV of $10.73 billion. Its market dominance stands at 36%, with a revenue of $393 million. Filecoin’s FIL token has seen significant price volatility over the past year, dropping from a high of $239.84 in May 2022 to $33.51 as of February 28, 2023.
The Internet Computer Protocol (ICP), launched in May 2021, has a market cap of $1.38 billion and an FDV of $3.46 billion. Its market dominance stands at 23%, with a revenue of $146 million. The ICP token has also seen significant price fluctuations, reaching an all-time high of $882.66 in May 2021 and falling to $43.58 as of February 28, 2023.
Arweave (AR), which uses blockchain technology to store data permanently, has a market cap of $896 million and an FDV of $2.24 billion. Its market dominance stands at 15%, with a revenue of $77 million. The AR token has had a more stable price trend, with a high of $110.24 in January 2023 and trading at $73.59 as of February 28, 2023.
Despite their unique features and use cases, all three storage projects have experienced significant drops in token prices over the past year, which can impact investor sentiment. The ChainStorage6 (CSTO) index offers a useful tool for monitoring the performance of Filecoin, ICP, and Arweave, key players in the blockchain storage industry.
Although these projects have demonstrated promising growth in terms of revenue and market dominance, the industry is becoming increasingly competitive with new projects entering the market. Furthermore, investors must also consider the growing competition from other technologies, such as cloud computing and AI.
By utilizing the CSTO index, investors can gain valuable insights for making informed decisions about the future of the storage industry🚀🚀!
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