Storj price continued its downward trend this week as concerns about file storage continue. The token crashed to a low of $0.2693, which was the lowest level since 2020. It has crashed by more than 92% below its highest level on record, giving it a market cap of $111 million. Other storage tokens like Filecoin and Arweave also slipped.
Storage tokens plunge
Cloud computing is one of the biggest industries in the world. These days, most companies are spending millions of dollars every year on cloud storage. As a result, companies like Amazon, Microsoft, Box, Dropbox, and Google make billions of dollars every year.
Cloud computing works in a relatively simple way. These companies deploy giant data centers around the world. They then use technology to ensure that files stored in them are accessible around the world.
Some computer scientists believe that decentralization can solve some of the biggest challenges in the industry. For example, instead of spending millions of dollars on data centers, they can use individuals who provide their storage and then earn a return. Such a network is believed to be much faster and more efficient. As shown below, Storj is cheaper than its centralized peers.
Storj uses the same model. The firm uses decentralized network providers who provide the storage that can be used by developers and also individuals. Some of the industries that use Storj are in the video sharing and streaming sectors.
Storj price declined as investors started to question its premise. The main concern is whether companies are willing or interested in using these decentralized platforms. Besides, centralized storage platforms like Amazon Web Services (AWS), Microsoft Azure, and Google Cloud work just fine. Similarly, consumer-faced companies like DropBox and Box work well.
Storj price forecast
The four-hour chart shows that the Storj price has been in a strong bearish trend in the past few months. On Monday, it managed to move below the important support level was $0.2734, which was the lowest level on November 24. It has also moved below all moving averages while the Relative Strength Index (RSI) moved to the oversold level.
Therefore, the coin, which has formed a bearish flag pattern, will likely have a bearish breakout as sellers target the next key support at $0.25. A move above the resistance at $0.28 will invalidate the bearish view.
