đź”— Blockchain Fundamentals - NVU Ratio by Cryptorhythms
đź”— Blockchain - NVU (Network Value to User) Ratio by Cryptorhythms
Introduction
Please note this is not an indicator that gives you buy and sell signals, its for bitcoin blockchain based fundamental analysis and valuation metrics.
Description
Blockchains have network effects.
The classic example of network effects is Facebook: every person who gets on Facebook makes the network a little more valuable for every other person on Facebook.
As the number of users in a network grows, the more valuable the network becomes. That’s why the most powerful companies in the world today are network companies: Facebook, Apple, Google. The old-school “blue chip” companies don’t have the benefits of network effects. (When a new customer buys your toothpaste, it doesn’t make toothpaste more valuable for everyone else.)
Blockchain assets (like bitcoin) are essentially networks. The more people who use a blockchain asset (like bitcoin), the more valuable that blockchain becomes. One way that analysts value network companies (like Facebook and Twitter) is by looking at Network Value per User. We take their market cap, then divide by their number of Monthly Active Users.
Of the top social media networks, the Value Per User generally ranges from $25 to $250. These values have fluctuated over time, but they give us some guard rails. Of the blockchains we can track, the Network Value per User is typically $1,000 and $5,000 per user. This makes sense, as we would expect blockchain NVU to be higher than social media NVU, since blockchain users are much more valuable—they’re not just mindless ad-consuming machines, like on Facebook.
The caveat is that Value Per User depends on knowing Monthly Active Users, which is not available for all blockchain assets. Blockchains that have this level of transparency will have better valuation metrics, which means they will become more trusted, and thus more highly valued.
Introduction
Please note this is not an indicator that gives you buy and sell signals, its for bitcoin blockchain based fundamental analysis and valuation metrics.
Description
Blockchains have network effects.
The classic example of network effects is Facebook: every person who gets on Facebook makes the network a little more valuable for every other person on Facebook.
As the number of users in a network grows, the more valuable the network becomes. That’s why the most powerful companies in the world today are network companies: Facebook, Apple, Google. The old-school “blue chip” companies don’t have the benefits of network effects. (When a new customer buys your toothpaste, it doesn’t make toothpaste more valuable for everyone else.)
Blockchain assets (like bitcoin) are essentially networks. The more people who use a blockchain asset (like bitcoin), the more valuable that blockchain becomes. One way that analysts value network companies (like Facebook and Twitter) is by looking at Network Value per User. We take their market cap, then divide by their number of Monthly Active Users.
Of the top social media networks, the Value Per User generally ranges from $25 to $250. These values have fluctuated over time, but they give us some guard rails. Of the blockchains we can track, the Network Value per User is typically $1,000 and $5,000 per user. This makes sense, as we would expect blockchain NVU to be higher than social media NVU, since blockchain users are much more valuable—they’re not just mindless ad-consuming machines, like on Facebook.
The caveat is that Value Per User depends on knowing Monthly Active Users, which is not available for all blockchain assets. Blockchains that have this level of transparency will have better valuation metrics, which means they will become more trusted, and thus more highly valued.
Versionshinweise:
Version 1.1 -
Fixed bug with lack of historical market cap data from the TV marketcap ticker.
From options you can select whether to use the TV Marketcap as source (more granular timframe data but less historical data).
Or you can use Blockchain based data (less granular - daily only - but much more historical data).
Fixed bug with lack of historical market cap data from the TV marketcap ticker.
From options you can select whether to use the TV Marketcap as source (more granular timframe data but less historical data).
Or you can use Blockchain based data (less granular - daily only - but much more historical data).
Versionshinweise:
Minor Fix
