Valuing BTC through production costs, which will exceed $ 13,000 when halved
Source: Crypto Valley Live, original title "BTC Valuation through Production Costs"
Author: Data Dater
Translation: Ziming
Since the birth of BTC, it has been a mystery for most people. Is it about to burst the speculative bubble or the mainstream currency of the future? Maybe a commodity of the future? How to determine whether its price is reasonable and whether its price trend is reasonable? Technical analysts on platforms such as TradingView, Twitter, Telegram, etc. are divided on the price trend of BTC. Currently, the average transaction price of BTC on major exchanges is $ 7,900 each. Some predict prices will drop to around $ 5,000. However, bulls believe that in the next May, we will witness the price of each BTC surpassing a high of $ 13,000.
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Existing valuation models and their limitations
- "Stock-to-Flow" model


- BTC “Energy-Value” Equivalent Model

- Production Cost Model (CoP)
Calculating capital expenditure

Calculating operating expenses

Model points
Predicting prices with the CoP model


Extending the CoP model to other PoW digital currencies


Core points
Comparing CoP models with indices of other assets
to sum up
- The CoP model is reliable for obtaining the intrinsic bottom price of BTC. The CoP price is the trending price of BTC and can provide an over / under-estimation signal.
- Taking into account the effective cost of ASIC miners and the rising trend of network hash rate, the CoP model predicts that the price of BTC will rise.
- The CoP model is also useful for evaluating PoW BTC tokens.
- It can be used to analyze the impact of other financial asset markets on BTC, and this analysis will be performed in the near future.
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