The Coin Times #6 - Jan 27, 2021 - final.pdf
155.6 KB
Hello everyone. Here is today's PDF version...
1. What If You Could Predict the Future BTC Price?
2. Wednesday News Summary
3. A Zoom In On The Stock to Flow BTC Price Model
4. Daily Podcast Summary
5. Five Crypto Recommendations
6. The People We Follow Closely on Twitter
1. What If You Could Predict the Future BTC Price?
2. Wednesday News Summary
3. A Zoom In On The Stock to Flow BTC Price Model
4. Daily Podcast Summary
5. Five Crypto Recommendations
6. The People We Follow Closely on Twitter
Here is today's online newsletter: https://cointimes.substack.com/p/coin-times-6-what-if-you-could-predict
Substack
What If You Could Predict the Future Price of Bitcoin?
The Stock-to-Flow Scarcity Model for the BTC Price, India Explores a Digital Currency, A16Z-backed dYdX Exchange Raises Another $10M
See pages 35-50 on Bitcoin in the above file “Big Ideas 2021” from Ark 👍👍
Very worthwhile DeFiant podcast today on DeFi, Ethereum, Cosmos, and Bitcoin. Camila Russo (author of The Infinite Machine) interviews the CEO of Shapeshift, Erik Voorhees. If you can understand this podcast you will be ahead of 99% of people investing in crypto.
https://anchor.fm/thedefiant/episodes/Crypto-Devs-Are-Building-a-Life-Raft-For-The-World-After-Fiat-Falls-Apart-Erik-Voorhees-eplbrf
https://anchor.fm/thedefiant/episodes/Crypto-Devs-Are-Building-a-Life-Raft-For-The-World-After-Fiat-Falls-Apart-Erik-Voorhees-eplbrf
Anchor
Crypto Devs Are "Building a Life Raft For The World After Fiat Falls Apart:" Erik Voorhees by The Defiant • A podcast on Anchor
In today’s episode, I speak with Erik Voorhees, long-time crypto advocate and founder and CEO of ShapeShift. In this interview, he talks about how he was able to stop gathering information about his customers and take the exchange back to its roots, by leaning…
Here's my comparison of Bitcoin vs. Ethereum by the numbers. I will be writing about it further in tomorrow's TCT.
https://docs.google.com/document/d/1GiGNx5a1QoGcDe57Swr_oVwVD5v4BmN6nt_7HsImj00/edit?ts=60184a2f
https://docs.google.com/document/d/1GiGNx5a1QoGcDe57Swr_oVwVD5v4BmN6nt_7HsImj00/edit?ts=60184a2f
Google Docs
Who’s the King: Bitcoin vs. Ethereum - Feb 1, 2021
Who’s The King? Bitcoin vs. Ethereum Data as of Feb 1, 2021 - By The Coin Times Bitcoin Ethereum Winner Source Market Cap $637 billion $153 billion Bitcoin Glassnode Global Monthly Miner Revenue $1.08B $829M Bitcoin The Block Reddit Community Size 2.2M…
The Coin Times #7 - February 2, 2021 - Final.pdf
268.8 KB
Here is today's PDF issue...
Here's the Substack newsletter for today (Tuesday)... please pass it along to friends...
https://cointimes.substack.com/p/whos-the-king-bitcoin-vs-ethereum
In Today's Edition:
Who's The King? Bitcoin Vs. Ethereum
Analysis: Monetary Policy & Fixed Supply
Crypto Portfolio Recommendations
The Adoption of Bitcoin vs. the Internet
Tuesday News Summary
Blockchain Developer Report
And please pass along our Telegram channel (@thecointimes) to other groups you are part of...
https://cointimes.substack.com/p/whos-the-king-bitcoin-vs-ethereum
In Today's Edition:
Who's The King? Bitcoin Vs. Ethereum
Analysis: Monetary Policy & Fixed Supply
Crypto Portfolio Recommendations
The Adoption of Bitcoin vs. the Internet
Tuesday News Summary
Blockchain Developer Report
And please pass along our Telegram channel (@thecointimes) to other groups you are part of...
Substack
Who's The King? Bitcoin Vs. Ethereum
BTC vs. ETH: Let the Numbers Decide, Monetary Policy & Fixed Supply, Portfolio Recommendations, The Adoption of Bitcoin vs. the Internet
Some friends were asking me today about how new banks like Voyager, BlockFi, and Nexo can pay out 6% per year interest on savings while old banks like Wells Fargo pay out 0.2%.
It’s actually quite simple...
1. They pay about 6% per year out on deposits
2. They take in 10-12% per year on loans
Voyager, BlockFi, Nexo, Crypto.com, etc on average pay out about 5-6% annual interest. It ranges from 0.2-8% based on what collateral you are putting down (BTC, ETH, USDC, etc) and other variables like whether you hold their native tokens.
Who’s taking the loans?
People and institutions who want to buy more crypto. People who want to pay for their basic living expenses without selling their crypto.
Why is this safe?
Because the positions are over collateralized and if the price of btc, eth were to drop significantly, the collateral would get liquidated. It’s full reserve lending and safer than fractional reserve lending that banks do where they loan out $10 for every $1 deposited. Here, these “Neobanks” are loaning out $1 for every $2 deposited, with full on-chain collateral.
The bubble isn’t in Decentralized Finance. DeFi is very very early and growing at 30-40% per month. See Defipulse.com. DeFi is based on permissionless distributed ledger technology, which is a major innovation that allows people to trust each other. Most of these DeFi tools are built on Ethereum, some are built on Binance Smart Chain, and some newer ones are being built on Polkadot. None are being built on Bitcoin as the Bitcoin blockchain is too slow and doesn’t enable smart contracts.
The real bubble is in the old fractional reserve banking system. I call that OldFi.
Asset Value of Top 5 banks: $15 Trillion
Asset Value of Top 5 DeFi protocols: $19 Billion
In other words, DeFi has around 0.13% the assets of the OldFi banking system so far (up from 0% a year ago). In a decade that should be around 30%. Capital will naturally flow to the better Neobanks built on blockchain tech and offering much higher yields than Fiat currency banks. If you can get 6% annual yield on your savings, with the deposits insured, why wouldn’t you?
You can sort of guess which asset class will go down and which one will go up the next 10 years.
To learn more read my newsletters at thecointimes.com. Happy investing!
It’s actually quite simple...
1. They pay about 6% per year out on deposits
2. They take in 10-12% per year on loans
Voyager, BlockFi, Nexo, Crypto.com, etc on average pay out about 5-6% annual interest. It ranges from 0.2-8% based on what collateral you are putting down (BTC, ETH, USDC, etc) and other variables like whether you hold their native tokens.
Who’s taking the loans?
People and institutions who want to buy more crypto. People who want to pay for their basic living expenses without selling their crypto.
Why is this safe?
Because the positions are over collateralized and if the price of btc, eth were to drop significantly, the collateral would get liquidated. It’s full reserve lending and safer than fractional reserve lending that banks do where they loan out $10 for every $1 deposited. Here, these “Neobanks” are loaning out $1 for every $2 deposited, with full on-chain collateral.
The bubble isn’t in Decentralized Finance. DeFi is very very early and growing at 30-40% per month. See Defipulse.com. DeFi is based on permissionless distributed ledger technology, which is a major innovation that allows people to trust each other. Most of these DeFi tools are built on Ethereum, some are built on Binance Smart Chain, and some newer ones are being built on Polkadot. None are being built on Bitcoin as the Bitcoin blockchain is too slow and doesn’t enable smart contracts.
The real bubble is in the old fractional reserve banking system. I call that OldFi.
Asset Value of Top 5 banks: $15 Trillion
Asset Value of Top 5 DeFi protocols: $19 Billion
In other words, DeFi has around 0.13% the assets of the OldFi banking system so far (up from 0% a year ago). In a decade that should be around 30%. Capital will naturally flow to the better Neobanks built on blockchain tech and offering much higher yields than Fiat currency banks. If you can get 6% annual yield on your savings, with the deposits insured, why wouldn’t you?
You can sort of guess which asset class will go down and which one will go up the next 10 years.
To learn more read my newsletters at thecointimes.com. Happy investing!
Everyone should read the above PDF on Valuing Ethereum from Grayscale. The summary: very good for ETH investors.
Some good excerpts from the Valuing Ethereum report from Grayscale... very bullish for ETH...
“Notably, total transaction fees during January 2021 were nearly 5x the peak fees of January 2018. Yet, Ether’s price is approximately equal to that of the 2018 peak.
“Ethereum 2.0 will transform Ether from a commodity to what we might describe as a productive commodity — holders will be able to generate interest by staking Ether. This asset structure is unlike anything else in the physical world. Commodities are consumed. Equities provide rights to cash flows. Under Ethereum 2.0, Ether can be consumed as a commodity or staked as a claim on cash flows, similar to equity.”
“Between the enormous amount of activity on Ethereum, the economic improvements to Ether, and the promise of increased scalability with Ethereum 2.0, there is a lot for the Ethereum community to be excited about. We can observe from the data that the price of Ether tends to move with underlying activity on the network. As noted throughout this report, multiple metrics are reaching new highs, including active addresses, hashrate, and network fees – a positive sign for investors.”
“In many ways Ether is functioning as new-age digital money on the Ethereum network. Anytime a user deploys a smart contract on the Ethereum network, provides liquidity to an application, or makes a trade on a decentralized exchange, Ether is necessary to pay network fees.”
“Ether is the native asset underpinning a burgeoning decentralized financial system. It is used as trust-minimized collateral for lending and borrowing, and is the primary capital source for applications built on top of Ethereum. At the time of writing, there are approximately 7 million Ether locked as collateral in decentralized protocols on the Ethereum network, worth over $9 billion at current prices. In many ways Ether is functioning as new-age digital money on the Ethereum network. Anytime a user deploys a smart contract on the Ethereum network, provides liquidity to an application, or makes a trade on a decentralized exchange, Ether is necessary to pay network fees.”
“Ethereum plans to implement a proposal known as EIP-1559.8 Among other things, this proposal would burn (or destroy) Ether that is used to pay for transactions. This is important because it would transform Ether from a medium of exchange asset to a consumable commodity. Ether would become more like combustible gas than money. If this proposal is implemented, it would also ensure that Ether is the native economic unit on Ethereum – protocol rules would dictate that only Ether could be burned. This would reduce the possibility of economic abstraction – the ability to pay fees in an asset besides Ether. This burning method may also serve as a deflationary mechanism if the Ether consumed as fuel outpaces the issuance schedule. If activity increases and the supply of Ether decreases due to burning, a supply and demand curve would indicate an increase in the unit price of Ether because each unit would need to satisfy a greater proportion of economic activity. If EIP-1559 is implemented, it would institute a consumption mechanism that should serve as a positive feedback loop for Ether’s price.”
“In a similar vein, hashrate on Ethereum, which measures the amount of computer power miners are using to validate transactions, is reaching new highs. Because it takes time for miners to recoup their initial investment, this is a sign that miners are confident that Ethereum will continue to generate high transaction fees. If miners felt that transaction fees would decline, they would be less willing to allocate resources to mining.”
“Notably, total transaction fees during January 2021 were nearly 5x the peak fees of January 2018. Yet, Ether’s price is approximately equal to that of the 2018 peak.
“Ethereum 2.0 will transform Ether from a commodity to what we might describe as a productive commodity — holders will be able to generate interest by staking Ether. This asset structure is unlike anything else in the physical world. Commodities are consumed. Equities provide rights to cash flows. Under Ethereum 2.0, Ether can be consumed as a commodity or staked as a claim on cash flows, similar to equity.”
“Between the enormous amount of activity on Ethereum, the economic improvements to Ether, and the promise of increased scalability with Ethereum 2.0, there is a lot for the Ethereum community to be excited about. We can observe from the data that the price of Ether tends to move with underlying activity on the network. As noted throughout this report, multiple metrics are reaching new highs, including active addresses, hashrate, and network fees – a positive sign for investors.”
“In many ways Ether is functioning as new-age digital money on the Ethereum network. Anytime a user deploys a smart contract on the Ethereum network, provides liquidity to an application, or makes a trade on a decentralized exchange, Ether is necessary to pay network fees.”
“Ether is the native asset underpinning a burgeoning decentralized financial system. It is used as trust-minimized collateral for lending and borrowing, and is the primary capital source for applications built on top of Ethereum. At the time of writing, there are approximately 7 million Ether locked as collateral in decentralized protocols on the Ethereum network, worth over $9 billion at current prices. In many ways Ether is functioning as new-age digital money on the Ethereum network. Anytime a user deploys a smart contract on the Ethereum network, provides liquidity to an application, or makes a trade on a decentralized exchange, Ether is necessary to pay network fees.”
“Ethereum plans to implement a proposal known as EIP-1559.8 Among other things, this proposal would burn (or destroy) Ether that is used to pay for transactions. This is important because it would transform Ether from a medium of exchange asset to a consumable commodity. Ether would become more like combustible gas than money. If this proposal is implemented, it would also ensure that Ether is the native economic unit on Ethereum – protocol rules would dictate that only Ether could be burned. This would reduce the possibility of economic abstraction – the ability to pay fees in an asset besides Ether. This burning method may also serve as a deflationary mechanism if the Ether consumed as fuel outpaces the issuance schedule. If activity increases and the supply of Ether decreases due to burning, a supply and demand curve would indicate an increase in the unit price of Ether because each unit would need to satisfy a greater proportion of economic activity. If EIP-1559 is implemented, it would institute a consumption mechanism that should serve as a positive feedback loop for Ether’s price.”
“In a similar vein, hashrate on Ethereum, which measures the amount of computer power miners are using to validate transactions, is reaching new highs. Because it takes time for miners to recoup their initial investment, this is a sign that miners are confident that Ethereum will continue to generate high transaction fees. If miners felt that transaction fees would decline, they would be less willing to allocate resources to mining.”
The Coin Times #8 - February 4, 2021 Final.pdf
265.4 KB
Here's today's issue for Feb 4, 2021... in this issue we talk about the spread of NewFi Banks and how they can offer 6-8% interest on your savings while OldFi Banks like Wells Fargo offer 0.02%.
Here's today's TCT Issue #8 - How Can NewFi Banks Offer 6-8% Interest on Savings While OldFi Banks Offer 0.02%?
https://cointimes.substack.com/p/how-can-newfi-banks-offer-6-8-interest
Please pass along @thecointimes channel to friends in crypto
https://cointimes.substack.com/p/how-can-newfi-banks-offer-6-8-interest
Please pass along @thecointimes channel to friends in crypto
Substack
The Rise of NewFi Banks
The Rise of Nexo and the NewFi NeoBank, OldFi vs. NewFi Banking, Market Analysis, Valuing Ethereum, & Our Crypto Recommendations
My one recommendation for today... get some NEXO tokens. Read today’s edition for the explanation why.
For anyone wanting to understand the deeper reason why the price of Bitcoin is up 4x in the last 12 months and is still undervalued watch this Michael Saylor (CEO of Microstrategy) interview of Ross Stevens (CEO of NYDIG) from yesterday. It's at the top of https://vincentdaranyi.com/bitcoin
Vincent Daranyi
Everything about Bitcoin, The Last Money — Vincent Daranyi
bitcoin, money, blockchain, decentralization, crypto