Trace Mayer's Mayer Multiple, Metcalfe's law
Trace Mayer was an early investor with Bitcoin as he initially purchased it when it was .25. He is an advocate for BTC and runs various companies and the Bitcoin Knowledge Podcast. (Screenshot above) If you are interested in BTC, blockchain and the technology, you can learn quite a bit from listening in on the back episodes of his podcast.
Trace has also made what he calls the Mayer Multiple. This is a ratio between the price and the price of the 200 day moving average. When the multiple is high, it can be seen as overpriced or overbought. When the ratio is low, it can be seen as oversold or underpriced.
The average Mayer Multiple is 1.47. The data can be viewed on 'The Investors Podcast' website. Below is a daily chart of BTC for 2017 with the 200 dma. You can see at the start of the year, the price was floating just above.
Here is a closer look at the previous high in Dec 17 and the last break low in Feb 18. I listed the price, date, 200 dma price and the ratio. In hindsight, purchasing BTC on 2/6/18 when the ratio was 0.811 was a good investment.
Some of the data collected over the years regarding the multiple. I'm assuming Green is the buy (if your long) and red/orange is the sell warning if your a trader. (I took individual screen shots as the excel spreadsheet was too small to read)
The Investors Podcast also had some information regarding the relationship between BTC and Metcalfe's law. (It basically states that the value of the asset grows as the user base grows. It was intentionally for networking, but has transferred to the internet and social media sites like FB.
When the initial telephone was introduced, it was not long before entire countries adopted the technology. How many people on the plant use a phone now?
This is a chart of BTC following Metcalfe's law. As more users adopt and purchase the coin, the value will exponentially increase.
I'm not sure if BTC will follow Metcafe's law 100%, but I'm fairly certain that it will be higher over the next few years.
I think the BTC price follows metcalfe's law. This chart is only completed till 2014 and follows the graph perfectly. Between 2017 and 2018 it should be 10k and it is! furthermore it makes a lot of sense to me that it does, the theory behind is quite solid. Beside that a calculation of adoption and market cap compare to other assets gives also a short term target of 100 k and longer term target of 1 million.
The Trace Mayer multiple is very useful, I will start use it too. In the last bull/ bear market I didn't cash enough out at highs and had to sell for living at lows. Now my next project is to create a system based on the multiple to decide the part of my income that I allocate in BTC or gold. When BTC is overpriced I will allocate most in gold and when BTC is undervalued I will allocate most in BTC. Also I will live off BTC when the price is above the moderate (1.47x) and live off gold when it is under. This way I never have to worry about the markets anymore.
Hey michiel, thanks for visiting the blog and glad you found a few bits useful. I will definitely be paying much more attention to the 200 dma with regards to buys/sells. I am typically a hodL'er, and don't do much trading, but it definitely helps define the low points for BTC.
I use a few of the other basic forms of technical analysis to find buy points. Mostly stochastics and high volume around a spike low.
I sure hope BTC follows Metcalfe's law as most of the other top 'alt' coins/tokens will most likely follow. I can definitely see worldwide adoption, but can also see governments getting involved as well too. Especially with taxes on cryptos. We shall see, 1 year in crypto is a long time!
Didn't know that was called Metcalfe's law, but I'm sure BTC price follows it. Definitely agree with you price will become more stable and higher following months and years.
Thanks for really good post!
AIRDROPS ALERT:
GET YOUR FREE -3.2- DATX COINS HERE @ https://www.datx.co/bounty2/invite/1ktfm3
GET YOUR FREE -20- LEMOCHAIN COINS HERE @ www.lemochain.com/airdrop_en.html#/?invite=3728345
GET YOUR FREE -30- CORBIT COINS HERE @ https://corbit.website/airdrop/uwNbf
GET YOUR FREE -50- OBIRIUM COINS HERE @ https://ico.obirum.com/?r=45384
GET YOUR FREE -100- SYNAPSE AI COINS HERE @ https://tokensale.synapse.ai/r/57695
GET YOUR FREE -1000- ALTA COINS @ - https://goo.gl/YKwNgs
GET YOUR FREE -5000- LUXY COINS HERE @ https://www.onluxy.com/static/spa/app/gridview/luxy_coin.html#/?id=9QOA
BONUS CHANCE TO WIN OVER $3000 USD WORTH OF DEVIANT COINS! 2000 PARTICIPANTS! HERE @ http://vy.tc/epnbv85
great info, thanks!
so good and informative post dear..thanks.for sharing..
This post has received gratitude of 3.88% from @appreciator courtesy of @glennolua!
You got a 2.31% upvote from @postpromoter courtesy of @glennolua!
Want to promote your posts too? Check out the Steem Bot Tracker website for more info. If you would like to support the development of @postpromoter and the bot tracker please vote for @yabapmatt for witness!
You got a 4.27% upvote from @buildawhale courtesy of @glennolua!
If you believe this post is spam or abuse, please report it to our Discord #abuse channel.
If you want to support our Curation Digest or our Spam & Abuse prevention efforts, please vote @themarkymark as witness.