New cryptographic data The site lists coins for their fair market value
A new encrypted website aims to provide encrypted investors with improved information on their favorite coins: available online at CoinFairValue.com, the site aims to provide users with information on the fair market value of a currency.
Websites such as BitcoinExchangeGuide.com and CoinMarketCap.com track the legal value of cryptocurrencies. You can check our site, for example, to confirm that a BTC is currently worth around $ 7,000. With CoinFairValue.com, things are different: the platform aims to measure fair value without speculating on an asset
How can the website track the fair value of a currency without speculating on a resource?
Well, the com response from the understanding of how information websites like CoinMarketCap work. There is not a single bitcoin price. There is no authoritative source that declares a precise price for bitcoins. Instead, the price of the bitcoin is based on the last price paid by someone for an exchange. Websites like CoinMarketCap work by aggregating cryptographic exchange data around the world. They aggregate data on the last price that someone paid for bitcoins, for example, to provide an approximate bitcoin price.
How does CoinFairValue.com work? Calculate fair value?
CoinFairValue.com works differently than sites like BitcoinExchangeGuide and CoinMarketCap.
Instead of using aggregated spot prices, the website measures "fair value" based on the current use of each currency.
CoinFairValue.com relies heavily on an article written last year by Pablomp called "Cryptocurrencies – What is the fair value of a currency?" In that article, Pablomp outlined a model for determining "Fair Value Currencies" or CFVs. That model uses a mathematical formula to derive the right value of currencies. Basically, the formula is dedicated to the calculation of the "use" of a currency. The more usable a currency is, the more the fair value will have, according to the Pablomp model.
To calculate "usability", the model analyzes the money supply. For example, currencies with more offerings in circulation will be considered more active and cheaper than currencies with a static supply.
"Our market cap differs from the market cap in other sites because we do not make the artificial distinction between the circulating supply and supply", explains CoinFairValue.com.
"Let's just say: the fact that the founders hold a part of the supply does not make their part of the supply less circulating than a part of the supply held for years by an investor.The" static "offer is reflected in the Velocity of Money. The more the "static" supply within the total supply, the lower the speed – so the greater the tendency to contain the savings. "
The end result is a completely new way of examine cryptographic data. The first and most important thing that you will notice on the CoinFairValue.com website is that the first two currencies listed are not cryptocurrencies: they are the dollar and the euro. The USD has a fair market value (FMV) of $ 1 per unit, while the EUR has an FMV of about $ 1.12 per unit. Both currencies have market capitalizations of over $ 12 to $ 14 trillion. The website also notes that the market capitalization of the USD is 12.903% higher than the market capitalization of $ 110 billion bitcoins.
Why does the website include EUR and USD? The website creator claims that legal currencies have an uncertain future bidding function, which is why they should be included. However, the calculation of the fair value of these currencies remains difficult because we can not keep track of the number of trades over a given period of time.
And the first five cryptocurrencies? It is here that CoinFairValue.com becomes interesting. This is where the data differ from those like ours and CoinMarketCap.
Bitcoin (BTC), for example, is priced around $ 6500 USD according to CoinMarketCap. On CoinFairValue.com, however, bitcoin has a fair value of $ 4,521.70 – a significant difference.
Ethereum, meanwhile, has a current price of $ 365 and a "fair value" of $ 532. BCH also recorded a similar increase, rising from a spot price of $ 607.44 to a "fair value" price. of $ 923.73.
Some currencies have very similar prices and market prices. Others have significant differences. ZCash, for example, has a spot price of $ 173.65 and a fair market price of $ 172.02.
It is similar to "Honest CoinMarketCap"
This is not the first time someone has tried to publish rankings that differ from the price encryption point.
There is an online spreadsheet, for example, called the Honest Coinmarketcap, created by Andrew Rennhack. This spreadsheet aggregates data based on global cryptocurrency volumes because, as explained by news.bitcoin.com, "the researcher claims that the vast majority of the volumes of BTC and ETH are false."
CoinFairValue.com is based on a similar premise. To calculate the fair value of a currency, the website analyzes speculative trading with respect to total trades:
"It comes to the rational conclusion that currencies must be traded at their fair value when the number of speculative exchanges in the same currency is negligible. for the total number of global exchanges conducted using the same currency as an instrument, such as when someone trades BTC for BCH because he thinks BCH will perform better. "
Although CoinFairValue.com tracks speculative transactions , the website states that it does not speculate on the future value of currencies and that information published online should not be considered future forecasts.
In any case, the website offers a unique and alternative view of the cryptocurrency markets. You can check CoinFairValue today on coinfairvalue.com