The Currency Analytics
By Maheen Hernandez
Eric Kovalak recently stated, “People are trying to translate the value of cryptocurrencies into a traditional model where they’d use something like P/E.”
There is a calculation called NVT Ratio, which is about network value to transactions ratio. This technically mirrors a P/E ratio for Bitcoin.
Mr. Kovalak stated that assigning a value to cryptocurrency is about evaluating the asset versus its philosophy and technology.
The digital coin should solve problems, which align with the philosophy or the distributed currency solution.
Analysts clearly define the criterion for evaluating cryptocurrency. The team behind the cryptocurrency is the primary factor.
The degree of transparency in the public statements matters in a great deal in determining the trust factor posed by the company.
Fanfare and an increase in stock prices are commonly seen with branded companies talking about their venture into the cryptocurrency market.
It is only when the reason behind why a company is in business is revealed, the rationale of the proposed price can be justified.