What are fundamental indicators?
There are two pairs of the most widely used fundamental indicators on the chain:
One is the number of transactions and transaction amount that reflect the activity of transfers on the chain.
The index of number of transactions is obtained by calculating the number of transfer transactions on the chain every day.
The daily transaction amount indicator is obtained by accumulating the amount of each transaction. The unit of the transaction indicator indicator is the currency standard, such as the transaction amount of BTC, the unit is BTC; at the same time, we also have a transaction amount USD indicator denominated in USD.
The second is the new address and active address of active users on the reaction chain.
(Adding an address is not a standard configuration for every data site, but you can add it inTokenviewMost of the new address data of the public chain can be found in the website, and we will open the data download soon~)
By calculating the addresses where transfer transactions occur every day, the active address is obtained.
Among the addresses that are active every day, the address with the first transaction is defined as a new address.
Derivation of basic data - valuation indicators
The information that can be reflected by the basic data is limited. If you want to see deeper information, you must carry out some deformation and transformation of the basic indicators. Among the various research directions of on-chain data, there is a field that is relatively close to investors is valuation.
What is a valuation? Simply put, it is the intrinsic value of the project.
The price we see on the exchange does not represent the real value of the project, but only reflects the consensus of investors involved in the transaction at the moment the transaction is successful. Then the price is determined by the consensus between the buyer and the seller, while the valuation is not the same, basically it is not affected by the price.
So what is the use of valuation? It has a strong theoretical background. In the long run, prices fluctuate around valuations.
So if you want to invest, it is very useful for investors to find out whether the fundamental indicators of a project are healthy and what the valuation level of the project is. For investors whose trading frequency is not too high, it also has reference significance for trading timing to a certain extent.
For speculative users, valuation has limited guidance for high-frequency trading, because the frequency of valuation changes is relatively low and the cycle is relatively long. But in terms of general direction judgment, valuation is a very important reference indicator.
So what are the valuation metrics in the cryptocurrency space?
This time we introduce two very classic valuation indicators
Derived from trading indicatorsNVT (Network Value to Transactions), and derived based on user metricsMetcalfes law
NVT is a model proposed by Willy Woo to measure the valuation of cryptocurrencies. Its theory is similar to an important indicator in stocks:Price-to-earnings ratio (P/E ratio). To put it simply, the NVT model believes that transfer transactions are the core value of cryptocurrencies, so the indicator model selects transaction amount as an indicator that reflects the fundamentals of the project.
Well, Metcalfe expressed a different opinion. He believes that a cryptocurrency project is more like an Internet company, so cryptocurrencies should be valued in the same way that Internet companies are valued. So what indicators does the old man think are the most important for Internet companies?Users activity!Therefore, the Metcalfe model believes that active users can reflect the core value of the project.
The results of the two valuation models can reflect whether the relative valuation of the current market price is overvalued, normal, or undervalued. If the price is overvalued, the predicted price will drop; conversely, if the price is undervalued The state is expected to rise in the later period.
With such a model, which one should we choose? Might have to see both.
Because one of the main differences between valuation models lies in their theoretical differences. From the above introduction, we can see that the NVT and Metcalfe models have different assumptions about cryptocurrencies. NVT assumes that tokens are stocks, while Metcalfe I think cryptocurrencies are Internet companies. Therefore, for projects that are more like stocks, it will be more accurate to use NVT for valuation; similarly, for projects that are more like Internet companies, it will be more accurate to use the Metcalfe model for valuation.
For the valuation indicators mentioned above, Tokenview’sIndex plateAll have been included and updated, users are welcome to check
