Instead, the P/S ratio focuses on the usage of a protocol, by tracking the total fees paid (revenue) by the users of its service. More info: https://t.co/XlHI7XPTvI
1/ Why the price to sales ratio (P/S) is a useful tool for crypto investors 👇
The price to sales ratio compares a protocol’s market cap to its revenues. A low ratio could imply that the protocol is undervalued and vice versa.
Instead, the P/S ratio focuses on the usage of a protocol, by tracking the total fees paid (revenue) by the users of its service. More info: https://t.co/XlHI7XPTvI
This transparency makes it possible to find protocols with high usage relative to market cap.
Note: Maker has gone from a high P/S ratio to #3 in a matter of months after raising the stability fees for DAI.
Also, two currently similar AMMs (Uniswap & SushiSwap) have the lowest P/S ratios.
The P/S ratio is calculated by dividing a project’s fully-diluted market cap by its annualized revenues.
The metric itself does not tell us about the growth patterns in a protocol’s market cap or revenues.
There seems to be a pretty direct correlation between the (low) P/S ratio & market cap --> revenues have been consistently high since the launch of the $UNI token.
Uniswap’s daily revenues have been consistently high during Q3-Q4 --> fluctuations in market cap have been the primary driver for changes in the P/S ratio.
There does not seem to be a direct correlation between the (low) P/S ratio and market cap.
Surges in Sushiswap’s daily revenues have trended its P/S ratio lower both during its launch and also more recently.
Compound’s market cap has been stable since the launch of $COMP. Its P/S ratio trended quickly to a low double-digit figure --> revenues spiked after the launch of its token.
Compound’s daily revenues spiked up significantly with the launch of the $COMP token and associated liquidity mining.
There seems to have been a pretty direct correlation between the P/S ratio & market cap during the early days --> revenues were low initially, but have been on an upward trend since.
Kyber’s daily revenues were relatively low in the beginning but have been on an upward trend for the past two years.
After the launch of Synthetix v2, the protocol had a relatively low market cap & high P/S ratio --> revenues were low initially, but have trended upward during the past quarter.
Synthetix’s daily revenues have been been on an upward trend during Q3-Q4, after a slower start in Q2.
Market cap of Ethereum is a long way from the highs of 2017, yet its P/S ratio is on par with leading DeFi protocols --> significant growth in revenues during the past 6 months.
Ethereum’s daily revenues have been consistently high during Q2-Q4, while its market cap has yet to catch-up with the growth of the Ethereum ecosystem.
It’s one of the first fundamentals-based indexes in the crypto market.
Source: https://t.co/ZeVImRsVAa
It shows that Compound, Uniswap, and MakerDAO currently hold the largest weightings in the index portfolio.
https://t.co/JzYpuFE0yY
More from Crypto
Michael Pettis @michaelxpettis argues that it is not always obvious who (China or the U.S.) adjusts best to "turbulent changes."
Bitcoin answers that question.
Thread:
World economies currently suffer four major redistribution challenges:
The most important is increasing government stealth use of the monetary system to confiscate assets from productive actors.
/2
That process is exacerbated by "Cantillon Effect" transfers to interest groups close to government ("the entitled class," public sector workers, the medical industrial complex, academia, etc....), which is destroying much of that wealth /3
The shadow nature (see Keynes) of government inflation makes the process unidentifiable, un-addressable and undemocratic.
The biggest victims (America's poorly educated young) are unequipped to counter generational confiscation tactics of today's wily senior beneficiaries. /4
Government control of the numéraire in key economic statistics (GDP, inflation, etc...) makes it impossible for economic actors to measure progress and liabilities. /5
Bitcoin answers that question.
Thread:
1/11
— Michael Pettis (@michaelxpettis) January 11, 2021
An article worth thinking about: \u201cAs changes to the world structure accelerate, China\u2019s rule is in sharp contrast with the turmoil in the West,\u201d says Beijing.
I agree, but I draw a different conclusion. The world is certainly currently going...https://t.co/ugha7ygqqx
World economies currently suffer four major redistribution challenges:
The most important is increasing government stealth use of the monetary system to confiscate assets from productive actors.
/2
That process is exacerbated by "Cantillon Effect" transfers to interest groups close to government ("the entitled class," public sector workers, the medical industrial complex, academia, etc....), which is destroying much of that wealth /3
The shadow nature (see Keynes) of government inflation makes the process unidentifiable, un-addressable and undemocratic.
The biggest victims (America's poorly educated young) are unequipped to counter generational confiscation tactics of today's wily senior beneficiaries. /4
Government control of the numéraire in key economic statistics (GDP, inflation, etc...) makes it impossible for economic actors to measure progress and liabilities. /5
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MDZS is laden with buddhist references. As a South Asian person, and history buff, it is so interesting to see how Buddhism, which originated from India, migrated, flourished & changed in the context of China. Here's some research (🙏🏼 @starkjeon for CN insight + citations)
1. LWJ’s sword Bichen ‘is likely an abbreviation for the term 躲避红尘 (duǒ bì hóng chén), which can be translated as such: 躲避: shunning or hiding away from 红尘 (worldly affairs; which is a buddhist teaching.) (https://t.co/zF65W3roJe) (abbrev. TWX)
2. Sandu (三 毒), Jiang Cheng’s sword, refers to the three poisons (triviṣa) in Buddhism; desire (kāma-taṇhā), delusion (bhava-taṇhā) and hatred (vibhava-taṇhā).
These 3 poisons represent the roots of craving (tanha) and are the cause of Dukkha (suffering, pain) and thus result in rebirth.
Interesting that MXTX used this name for one of the characters who suffers, arguably, the worst of these three emotions.
3. The Qian kun purse “乾坤袋 (qián kūn dài) – can be called “Heaven and Earth” Pouch. In Buddhism, Maitreya (मैत्रेय) owns this to store items. It was believed that there was a mythical space inside the bag that could absorb the world.” (TWX)
1. LWJ’s sword Bichen ‘is likely an abbreviation for the term 躲避红尘 (duǒ bì hóng chén), which can be translated as such: 躲避: shunning or hiding away from 红尘 (worldly affairs; which is a buddhist teaching.) (https://t.co/zF65W3roJe) (abbrev. TWX)
2. Sandu (三 毒), Jiang Cheng’s sword, refers to the three poisons (triviṣa) in Buddhism; desire (kāma-taṇhā), delusion (bhava-taṇhā) and hatred (vibhava-taṇhā).
These 3 poisons represent the roots of craving (tanha) and are the cause of Dukkha (suffering, pain) and thus result in rebirth.
Interesting that MXTX used this name for one of the characters who suffers, arguably, the worst of these three emotions.
3. The Qian kun purse “乾坤袋 (qián kūn dài) – can be called “Heaven and Earth” Pouch. In Buddhism, Maitreya (मैत्रेय) owns this to store items. It was believed that there was a mythical space inside the bag that could absorb the world.” (TWX)
