FYI - For Your Innovation

On-Chain Data: A Framework to Evaluate Bitcoin

Listen Later

Bitcoin is unique relative to traditional asset classes, meaning that it is unable to fit within the framework associated with them, and this has prevented investors from understanding it as well as adopting it. In an attempt to address this, ARK analyst Yassine Elmandjra recently co-authored a white paper with prominent crypto on-chain analyst, and ARK consultant David Puell that provides a simple approach on how to analyze public blockchains entitled ‘On-Chain Data: A Framework to Evaluate Bitcoin’. David and Yassine use the framework to discuss on-chain data, its importance, how we get to our metrics using it, and to give some context around the work we have done to develop it. We begin with a definition of on-chain data, then dive into the three-tiered framework, and along the way, point to some of the insights it is possible to gain from cryptographically verified access to such data on the blockchain. Tune in for all this and more, today!

“Your 200-day moving average has been an attempt from especially retail traders to get that holy grail cost basis of the market. But in Bitcoin, we have it in a cryptographically verified way.” – kenoshaking
Key Points From This Episode:
  • What on-chain data is and how it analyzes the inner economics of Bitcoin.
  • The nature of on-chain data and why it is easy to extract it from Bitcoin.
  • How Bitcoin’s transparency is one of its value propositions as it pertains to the ability to analyze it.
  • The framework developed to provide a basis to analyze public blockchain networks.
  • The three-layer pyramid of the framework: Network health, cost basis, and the third layer that combines them.
  • An explanation of the concept of ‘realized capitalization’.
  • How the transfer of the asset itself is a proxy for a buy and sell that determines cost basis.
  • What it means if the realized cap is greater than the market cap.
  • How significant it is that bitcoin provides a cryptographically verified cost basis.
  • The fact that on-chain data is on-demand and not subject to human error.
  • An explanation of the short to long-term realized value ratio developed by ARK.
  • What it means that over 50% of Bitcoin supply hasn’t been moved in two years.
  • Weighting the 1-day and 6-12-month HODL waves by realized cap.
  • What the on-chain data says about where we are relative to this market cycle.
  • David’s take on the process of developing active management relevant signals.
    • ...more
    View all episodesView all episodes
    Download on the App Store
    FYI - For Your InnovationBy ARK Invest
    • 4.7
    • 4.7
    • 4.7
    • 4.7
    • 4.7

    4.7

    388 ratings

    More shows like FYI - For Your Innovation

    View all
    We Study Billionaires - The Investor’s Podcast Network by The Investor's Podcast Network

    We Study Billionaires - The Investor’s Podcast Network

    3,372 Listeners

    This Week in Startups by Jason Calacanis

    This Week in Startups

    1,286 Listeners

    The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch by Harry Stebbings

    The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch

    533 Listeners

    Masters in Business by Bloomberg

    Masters in Business

    2,176 Listeners

    The a16z Show by Andreessen Horowitz

    The a16z Show

    1,092 Listeners

    The Meb Faber Show - Better Investing by The Idea Farm

    The Meb Faber Show - Better Investing

    940 Listeners

    Unchained by Laura Shin

    Unchained

    1,213 Listeners

    Azeem Azhar's Exponential View by Azeem Azhar

    Azeem Azhar's Exponential View

    614 Listeners

    Real Vision: Finance & Investing by Real Vision Podcast Network

    Real Vision: Finance & Investing

    908 Listeners

    The Intrinsic Value Podcast - The Investor’s Podcast Network by The Investor's Podcast Network

    The Intrinsic Value Podcast - The Investor’s Podcast Network

    559 Listeners

    All-In with Chamath, Jason, Sacks & Friedberg by All-In Podcast, LLC

    All-In with Chamath, Jason, Sacks & Friedberg

    9,927 Listeners

    The Memo by Howard Marks by Oaktree Capital Management

    The Memo by Howard Marks

    449 Listeners

    No Priors: Artificial Intelligence | Technology | Startups by Conviction

    No Priors: Artificial Intelligence | Technology | Startups

    131 Listeners

    BG2Pod with Brad Gerstner and Bill Gurley by BG2Pod

    BG2Pod with Brad Gerstner and Bill Gurley

    466 Listeners

    AI + a16z by a16z

    AI + a16z

    36 Listeners