Is the Bull Market Over? What Valuation Models Tell us?

Sep 7, 2024

Jupiter Zheng from HashKey Capital, an expert in cryptocurrency valuation, dives into the current state of the Bitcoin market. He discusses various valuation models like NVT and MVRV, alongside the stock-to-flow method. The conversation reveals intriguing predictions, including Cathie Wood's projection of Bitcoin reaching $1M by 2030. Jupiter also addresses skepticism surrounding digital assets and the evolving methodologies needed to evaluate them effectively, highlighting challenges and future trends in the crypto landscape.

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Intro

00:00 • 2min

Valuing Digital Assets: A Methodological Approach

02:08 • 9min

Long-Term Investment Strategies in Cryptocurrency

11:08 • 13min

Navigating Data Challenges in Crypto Finance

24:06 • 5min

Analyzing Cash Flow in Ethereum and Bitcoin Networks

28:48 • 2min

Analyzing the Current Crypto Market: Bullish Perspectives and Future Insights

30:28 • 4min

The market is grinding, sentiment has turned bearish, and many are now asking: 'Is the bull market coming to an end?'"

Join me in welcoming back Jupiter Zheng, HashKey Capital, for a timely session about Bitcoin, cryptocurrency, and digital asset valuation based on the book “Digital Asset Valuation Framework” by HashKey Capital.

We explore the methodologies used in valuing digital assets, debunk common skepticism, and discuss the intriguing predictions from industry leaders like Cathie Wood.

Learn about the NVT, MVRV, and stock-to-flow models used to evaluate Bitcoin and discover valuation models for Ethereum and other Layer 1 public chains.

We also look at the current market trends and what the future holds for crypto assets.

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00:00: Introduction, skepticism surrounding Bitcoin and crypto’s long-term value

02:33: “Digital Asset Valuation Framework” book overview

Published April 2024
Fusion of existing crypto valuation methods with traditional beta models
Categories of digital assets and corresponding valuation methods

04:56: Bitcoin valuation framework, key principles and metrics

08:48: Zoom in on the following methods

NVT
MVRV and its relevance to predicting the crypto market cycle
Stock-to-flow
Evolving valuation methods as Bitcoin is undergoing changes

15:16: How does Cathy Wood project $1M Bitcoin price by 2030

5% allocation of global investable assets
Impact of BTC spot ETF
Parallels of BTC ETF and price and Gold ETF and price
Key milestones for Bitcoin to cement its status as “digital gold”

19:08: Ethereum and smart contract Layer 1 valuation

DCF
Quantify network security and incorporate it into valuation models
Commonalities and differences between Ethereum and its competitors, e.g. Solana (Ethereum killers) to be considered when calculating DCF

24:06: Data’s reliability and availability for building valuation models

Glassnode/Kaiko/Coin Metrics/Nansen/CryptoQuant

26:26: Warrant Buffett’s mental framework when evaluating stocks and assets

His skepticism about gold’s value
Different investors' perspectives on the value of cash-flow-generating and non-cash-flow-generating investment assets
Bitcoin as an alternative financial system

30:27: Current cycle - where are we now and outlook

What MVRV tells us
Industry’s consensus about Bitcoin’s price in this cycle
BTC spot ETF’s impact on this cycle
Why ETH is underperforming, how about the altcoins
Market sentiment and outlook

33:36: Closing

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This discussion session is for educational and informational purposes only, not investment or financial advice, and the speakers' views are their own.