This is what happens to your crypto portfolio when you use too much leverage. And by your crypto portfolio, I mean my crypto portfolio. 😬

I was 40% levered on Nexo on May 12. By May 23, it was 83%, the max level before they liquidate your holdings. A $1.7M portfolio turned into $300k in 7 days.

Big lesson learned! Full write up coming this week on learnings and my new game plan.

Here is the ETH Fundamental Value Model I have built.

I will post this from time-to-time going forward in this group and in the newsletter so we can see how the price compares to the fundamentals.

You get in when lower than the green line and de-risk a bit when we get close to the red line.

The takeaway is that ETH was exceptionally cheap two days ago and is still trading below its fundamental value based on its cash flows.

The price floor is trailing 12 month revenues x 60

The fair value min is trailing 12 month revenues x 100

The fair value max is trailing 12 month revenues x 140

The price ceiling is trailing 6 month revenues x 230

Keep in mind that for ETH soon 100% of Ethereum revenues will go to holders either indirectly via token burns (like a stock buyback) or via staking rewards (like a stock dividend). So 100% of revenues will soon be cash flows with EIP-1559 in July and the PoS merge in December.

Let me know if you have questions about how to use the model.

Here is the EARLY EDITION of this week's Coinstack newsletter -- just for Telegram channel subscribers...

https://docs.google.com/document/d/1gh9A1ghhpXuz_BrwSCCY8qIZ43fKHJuLQd1dk6_fXMg/edit#

In this issue:
- The $1M Lesson - Lessons Learned Getting Liquidated on Nexo 😬
- Introducing Ethereum’s Fundamental Value Model (FVM)
- Did You Buy The Dip?
- Using RSI To Time The Market
- Invest in the Coinstack Alpha Fund - Up 13% Last 30 Days
- Portfolio Update - Up 125% YTD 👀
- The Engineered Crypto Flash Crash - By Two Comma Pauper
- My Top 30: A Long-Term Crypto Portfolio
- The Shit List: What NOT to Invest In
- Join my Tuesday Crypto Advice Calls
- Featured NFTs of the Week by Mrs. Bubble
- Who I’m Following Closely on Twitter
- How to Get Started in Crypto

Here's the online Coinstack for this week:
https://coinstack.substack.com/p/the-1m-crypto-lesson

Please share with your friends...

Here’s a good essay regarding the inevitability of the flippening...

https://newsletter.banklesshq.com/p/the-flippening-is-inevitable

For those who want to better understand how EIP-1559 will work starting in July...

https://twitter.com/stefancoburn/status/1398043519164444673?s=21

Podcast of the day:

On The Defiant podcast today, Jeff Dorman CIO of Arca Digital Assets talks about how to apply traditional finance valuation metrics to value DeFi tokens like Sushi that offer real cash flows to their token holders.

I recommend listening 🎧 to minutes 35-40 for the best part...

https://podcasts.apple.com/us/podcast/the-defiant/id1512654905?i=1000523420620

The takeaway: protocols that offer cashflows to their token holders will win.

Here is the EARLY EDITION of this week's Coinstack newsletter -- just for our Telegram subscribers...

https://docs.google.com/document/d/1X7GUq3CDDOcnTniwLYuHja20GQL_51A-Xyy4FUA93Bk/edit#

In this issue we cover:

What’s Winning Now: Top 15 Returning Investments The Last Week
This Week in Ethereum: On-Chain Analytics by Mike Gavela
Ethereum Is Undervalued on a Fundamental Basis
My Take: What’s Happening Right Now in Crypto
My Top 30: A Long-Term Crypto Portfolio
Join Our Tuesday Crypto Advice Calls
Featured Art NFTs by Mrs. Bubble
Coinstack Alpha Fund - May 2021 Results
Who I’m Following Closely on Crypto Twitter
How to Get Started in Crypto Learning

Here's the online edition of Coinstack for this week. Please favorite the online version and share it with friends!

https://coinstack.substack.com/p/whats-winning-now-in-crypto

In this issue I make the argument that Bitcoin is slowly dying and on its way out as the largest crypto asset...

As you can see above the number of people holding Bitcoin has declined by 22% year to date, while ETH is actually up 22% year to date.

Its main differentiator as a store of value with a low inflation rate is starting to be eroded as within 9-12 months or less Ethereum will be deflationary.

What are your thoughts? Does Bitcoin have a future? What do you think will be the largest crypto asset by market cap in 2025? BTC, ETH, or something else?

Here is the EARLY EDITION of this week's Coinstack newsletter.

https://docs.google.com/document/d/1-ZLg-pkfu8Nuf3onG7-cYvyedvoxjOS7ynaN8LG6fIM/edit#

Bitcoin for Countries by Ryan Allis
Understanding the Macro Crypto Picture by Ryan Allis
Ethereum On-Chain Analysis by Mike Gavela
Ethereum Fundamental Value Model (FVM) Now Live
My Top 30: A Long-Term Crypto Portfolio by Ryan Allis
Top Performers Last 7 and 30 Days by Ryan Allis
Join Our Tuesday Crypto Advice Calls
Featured Art NFTs by Mrs. Bubble
Who I’m Following Closely on Crypto Twitter
How to Get Started in Crypto Learning

Here is this week's newsletter... please share with your friends...

https://coinstack.substack.com/p/bitcoin-for-countries

Here is the text of the newly proposed Bitcoin Law that will soon make bitcoin legal currency in El Salvador 🇸🇻. A great moment in history!

https://twitter.com/nayibbukele/status/1402446890466217985?s=21

President Bukele of El Salvador is speaking live on Twitter spaces right now about the law to make Bitcoin legal currency there. Join below and listen in...

https://twitter.com/i/spaces/1ypJdgQdDpnGW

The Bitcoin currency legalization bill has passed the El Salvador congress today 62 votes in favor to 17 against and will become law officially in 90 days.

And there are now over 21,000 people listening to President Bukele on Twitter Spaces right now at https://twitter.com/i/spaces/1ypJdgQdDpnGW

Pretty incredible day and a seminal moment in Bitcoin history.

Coinstackers--We will be doing one "Open Thread" post per week to generate discussion among our Coinstack community about important crypto topics. We'd love your comments today on the first open thread post here: https://coinstack.substack.com/p/open-thread-what-do-you-think-of/comments

Here’s a great YouTube livestream from today by Bankless on The Current State of DeFi with Vance Spencer, Santiago Santos, and Spencer Noon - https://youtu.be/9mUCFRu4fkk

Another great podcast from Bankless - The Bull Case for DeFi With Vance Spencer.

Our Ethereum Discounted Cash Flow (DCF) is mentioned by Vance at 1 hr 31 minutes.

👍👍

Listen at:
https://podcasts.apple.com/us/podcast/bankless/id1499409058?i=1000524475606

🔊🎧

Here are the top performing crypto investments for the last 1 day and 7 days. You can see many of our favorites like Kusama, Polkadot, Solana, Telcoin, Theta, and Nexo on the lists.

Here are the top performers for the last 24 hours and last 7 days per CoinMarketCap...

Favorites like Fantom, Theta, Aave, ThorChain, and Holochain made the list for the last 24 hours...