Claim : For Ethereum, because 48% of network activity remains since the peak, the “proxy value” for Ethereum is 0.48^2 or 0.23 – implying that it’s justifiable for Ethereum price to be down by 77% ( not 93% as currently down).
Category : Token Economics / Network Valuation
Source : https://medium.com/@cburniske/bitcoin-ethereum-prices-are-down-more-than-the-fundamentals-88fd18a86d14
Evidence/Argument : The following are 3 sub-claims that make up the larger claim.
Sub-claim #1 : Ethereum price is down 93% from peak on 1/13/18
Evidence : peak price at $1385.02, on January 13th, 2018. Current prices, as of this writing, is $89.93. This is down 93.5%
Status : Supported.
Sub-claim #2: Within the article, the starting point of Burniske’s analysis is that Ethereum is currently processing ~500,000 transactions per day
Status: Supported. Burniske offers an approximate round number that is close enough to current levels.
Sub-claim #3 : From peak (1/13/18) Ethereum price is down 93% (while daily transactions are down only down 52%); implying that the remaining network activity is at 48%
Burniske uses the peak in Ethereum daily transaction at (1/13/18), because that’s when the price peaked (note: contrary to my previous understanding and analysis with Bitcoin).
The charts below indicate that on (1/13/18), there were 1,179,321 transactions. If we take Ethereum Daily Transaction on 1/13/18 subtract the latest (12/10/18) transactions per day; 1,179,321 vs. 555,379; current est transactions/per day is 47% of the peak or down 53%, this implies that remaining network activity is 47%. According to Burniske’s analysis, 0.47^2 = 22% (implying it’s justifiable that Ethereum’s price is down 78% (Burniske’s figure is 77%), which is quite a ways off from the 93% current downturn).
Source: Raw CSV file from https://etherscan.io/chart/tx
Status : Confirmed.
Ethereum prices are down lower than fundamentals. Fundamentals are down 78%, prices are down 93.5%.