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A curious fact

"According to Metcalfe's Law, the value of a network is related to the square of the number of connected users. Considering an estimated one million active users per day on the Bitcoin network, the application of this principle suggests a theoretical network value of 1,000,000,000,000,000,000.

Taking into account the total amount of Bitcoin that could exist, which is 21 million, we could estimate the theoretical value of each Bitcoin by dividing this value by the total amount. However, given that there are currently approximately 19.5 million Bitcoin in circulation, adjusting this calculation, the theoretical value of each Bitcoin, under this approximation, could be around $51,282.05.

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Discussion

SMS 2y ago

Add a zeros.

ede3d957... 2y ago

The same calculation gives you a network value of $3000 for Monero.

hh 2y ago

You have to find the equilibrium point of two variables: as BTC's purchase power goes up, the number of people who will transact in it will in fact decrease, not increase, because it will become too valuable to spend. To have an idea of what the intersection is, probably you want to find out how many high volume (let's say the equivalent of $50,000 in purchase power, or 500k, or 5 M, it's arbitrary) transactions happen every day and how many users that is.

hh 2y ago

Another thing to take into account though, which I think makes BTC potential to he spent even lower, is that those spending it will not do it unless they have a reasonable expectation to be paid in BTC as well. So, if I transfer 500k in BTC to pay for a house, I would only do it if I have another asset to sell that I know I will be able to be paid for in BTC. Unless I'm simply liquidating my wealth because I'm bankrupt, or I'm old and don't intend to pass it on, or something.

Deleted Account 2y ago

Yeah but number of active addresses is not equal to number of active users. Also, should you consider active users only active node runners or also people having only a wallet?

Shllomo N 2y ago

É uma comparação equivocada porque são valores de tipo diferente. O valor do BTC não está atrelado ao valor da rede.

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Car44 2y ago

But the per Bitcoin price is set at the exchange (theoretically all these Bitcoin are for sale, we will ignore silly people who store on exchange). That would make

1 quadrillion ÷ 3 million

= 333 Billion 👀

Someone explain to me why I am wrong!

zhenya 2y ago

Because the number on exchange is not fixed. If bitcoin pumps or dumps that could change. Plus off exchange settlement brokers like unchained, fireblocks, ceffu, sfox let you buy and sell from a self custody wallet creates much noise to 3m figure.

Car44 2y ago

I think we need Jeff Booth on this one!

zhenya 2y ago

Something like everything goes to zero against bitcoin or You can’t measure price from within the broken system ha.

Toxic Bitcoiner 2y ago

“the value” denominated in what? A trillion, what? Any choice of unit is arbitrary.