RE: Bitcoin: The Bull Market of 2017
I agree with you that network value should not be measured by transaction cost. Instead, the best valuation metric that I've seen so far is Willy Woo's NVT Ratio (Network Value to Transactions Ratio), where Bitcoin's NVT is calculated by Network Value (Market Cap) divided by the USD volume transmitted through the blockchain. http://charts.woobull.com/bitcoin-nvt-ratio/
Chris Burniske's more generalized cryptoasset valuations model from https://medium.com/@cburniske/cryptoasset-valuations-ac83479ffca7 also holds a similar view (makes sense given Willy credited Chris with the NVT name):
The GDP of a cryptonetwork is represented by the on-chain transaction volume of its cryptoasset.
Surprisingly, current NVT shows that we are within range of normal valuation. Have you guys found better valuation models than this?
Great comment, thank you. I vaguely remember hearing about this approach, and it does seem quite interesting to me. I've always been a fan of this article by @falkvinge from 2013: The Target Value For Bitcoin Is Not Some $50 Or $100. It Is $100,000 To $1,000,000.
Yeah that jumped out at me too. It really feels like trying to pass a negative off as a positive.
In the long run surely competition will put increased pressure on fees. So a DPOS which has a much lower cost base than PoW will have a growing competitive advantage.