Jurrien Timmer, director of Global Macro in Fidelity Investments’ global asset allocation division, took to Twitter this weekend and explained why Bitcoin is relatively cheap at the moment.
Specialized in global macro strategy and active asset allocation, Timmer provided a price outlook for Bitcoin and Ethereum. He detailed:
“I use the price per millions of non-zero addresses as an estimate for bitcoin’s valuation, and the chart below shows that valuation is all the way back to 2013 levels, even though price is only back to 2020 levels.”
He clarified:
In other words, bitcoin is cheap.
The Fidelity Head continued:
“At its recent low of $17,600, bitcoin is now below even my more conservative S-curve model, which is based on the internet adoption curve.”
Timmer explained that by looking at Bitcoin’s network growth that “the adoption curve is tracking the more asymptotic internet adoption curve, rather than the more exponential mobile phone curve.” Therefore, “per Metcalfe’s Law, slower network growth suggests a more modest price appreciation.”
Nevertheless, Timmer noted that “based on a simple power regression line, Bitcoin’s network appears to be intact” and “that continued growth in Bitcoin’s network, combined with lower prices, means that bitcoin’s valuation is coming down.”
The Fidelity director also shared his price outlook for Ethereum noting that it might even be a better bargain than Bitcoin:
“If bitcoin is cheap, then perhaps ethereum is cheaper. If ETH is where BTC was four years ago, then the analog below suggests that ethereum could be close to a bottom.”
At press time, Bitcoin is trading at $20,806, up 8% over the past seven days. Ethereum is moving hands at $1,167, up 9% over the last week. Both top crypto assets are still at a loss of 30% over the past thirty days.
The post Fidelity Director: Bitcoin and Ethereum Are Cheap and Bottoming Out appeared first on iGaming.org.
Source: Igaming
