Nobody will be happy about fundamental metrics in crypto — including this one

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There’s a deep yearning for fundamental valuation metrics in crypto. 

Any basic formula would do, in the same way that dividing a company’s share price by its earnings per share spits out a P/E ratio that can broadly decide whether a stock is overvalued or not.

Blockworks Research’s Real Economic Value could very well lay the basis for something similar in crypto.

One little problem: Whatever metrics come out in the wash, nobody is going to be happy about the results. 

Just like how P/E ratios are generally much higher than they were in previous decades — making many stocks appear wildly overvalued by comparison — it could well be that cryptocurrencies are priced much higher than what’s implied by the activity they support.

So, if that’s the case, I’m here to throw fuel on the fire.

Here are two charts, for Ethereum and Solana, respectively. Each one plots the native token price against the backdrop of their NFT and DEX volumes.

Pay attention to the white space between the trading volumes (in green) from the price of ETH (in blue) — notice how separated they are.

If onchain trading activity were a fundamental metric on which to value native coins, then Ethereum DEX volumes would need to more than double from here to close the gap. 

And that gap would then represent the value of the hype surrounding a particular chain — pushing the coin up to match the network’s future potential.

The kicker: The price of ETH has only really aligned with onchain trading volumes once in the past four years — where the blue line touches the green space during the Terra market crash in June 2022, when ETH bounced off $1,000 while the chain recorded $73 billion in monthly volumes across NFTs and DEX. 

Now, here is the same chart but for Solana, shown over two years instead of four. 

See how the price of SOL stretched far above any onchain activity — until this year, when monthly DEX volumes had surged tenfold in five months to almost $340 billion alongside memecoin and AI agent hype.

If any of this holds any weight (and that’s a big if), then it would imply SOL is reasonably priced right now compared to its DEX activity. It would be a shame if something happened to it.

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