What is Metcalfe’s Law, and why does it matter? By Cointelegraph
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Yes, Metcalfe’s Law can help explain Bitcoin’s price formation — to some extent. It is relevant to since it implies that the value and utility of the Bitcoin network rise exponentially with its number of users and participants (holders, investors and traders).
The adoption of Bitcoin has been accompanied by a positive feedback cycle in which increased users have resulted in a rise in BTC’s value, drawing even more players. Bitcoin had a small user base in the early days, and its value was relatively low.
Network adoption and value
Decentralization
Network effects
Market valuation
Scalability and competition
Tokens and utility
Metcalfe’s Law highlights that the services, goods or advantages that utility tokens offer to their user base determine the value of those tokens. The token increases in value as more users decide that utilizing it is worthwhile.
Continue Reading on Coin Telegraph
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Yes, Metcalfe’s Law can help explain Bitcoin’s price formation — to some extent. It is relevant to since it implies that the value and utility of the Bitcoin network rise exponentially with its number of users and participants (holders, investors and traders).
The adoption of Bitcoin has been accompanied by a positive feedback cycle in which increased users have resulted in a rise in BTC’s value, drawing even more players. Bitcoin had a small user base in the early days, and its value was relatively low.
Network adoption and value
Decentralization
Network effects
Market valuation
Scalability and competition
Tokens and utility
Metcalfe’s Law highlights that the services, goods or advantages that utility tokens offer to their user base determine the value of those tokens. The token increases in value as more users decide that utilizing it is worthwhile.
Continue Reading on Coin Telegraph
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