Most investment advisors are well versed on valuation methodologies for traditional assets like stocks, bonds and real estate. However, when it comes to trying to determine a value for a cryptocurrency, the time tested valuation methods such as price-to-earnings ratios, discounted cash flows or the capital asset pricing model, do not apply here. New valuation methodologies need to be employed.
In the world of technology, most are familiar with Moore’s Law, which basically states that computer power doubles every 18 months. Moore’s Law is very, very well known, and has been around for decades.
Metcalfe’s Law is another tenet within the realm of technology, although not nearly as well known as Moore’s Law. Explained simply, Metcalfe’s Law states that the value of a network is proportional to the square of the number of users. Or, inother words, the larger the network, the greater the value.
It is in light of Metcalfe’s Law that we will share some ideas of the IEO (Initial Exchange Offering) price of $1 for the Freedom Convoy Coin. First, there is a maximum of 35 billion FCC coins in existence. This number cannot be increased. At an IEO price of $1 per coin, that would place the total market cap of FCC at $35 billion.
Is that even realistic? Because of Metcalfe’s Law, we believe the definitive answer is yes.
The larger the network, the greater the value. The Freedom Convoy Coin will be released to the public via a free airdrop once 3 million people have signed up. Thus, the network size of FCC will reach a minimum of 3 million before the IEO.
Let’s look at the value of other cryptocurrencies and the size of their networks as of late February of 2022 for comparison.
Of course the Godfather of crypto is Bitcoin, which has about 30 million wallets with any amount of Bitcoin in them. The IEO of FCC will occur when 3 million people have signed up for the airdrop. That will be almost exactly 10% of the size of Bitcoin.
As of this writing, the market cap for Bitcoin is $760 billion. Using a direct size comparison as a valuation metric, that would place the market cap of FCC at $76 billion (the size of the network of FCC would only be 10% as large as Bitcoin, therefore the market cap would only be 10% as much). $76 Billion is more than twice as much as the IEO price.
We will look at another example, XRP. There are approximately 1.3 million wallets, with nearly 1 million wallets holding more than the minimum, and a further 127,000 holding just the minimum amount.
As of this writing, the market cap for XRP is $37 billion. Using the size of the XRP network as a metric, that would place the market cap of FCC at just over $80 billion, again, more than twice as much as the IEO price.
We will look at another one that gained a lot of interest in 2021, Shiba Inu. There are approximately 1.145 million holders in SHIB’s network. As of this writing, the market cap for SHIB is $15.5 billion. Using SHIB’s network size as a metric, that would place the market cap of FCC at just over $40 billion, again, more than the market cap of FCC at the IEO price.
Lastly, we will look at ADA. There are approximately one half million wallets. As of this writing, the market cap for ADA is $33 billion. Using this as a metric, that would place the market cap of FCC at $198 billion, again, more than 5 times as much as the IEO price.
Will FCC rise or fall after the IEO?
We are doing everything we can to create the environment in which FCC will rise. Only one one-hundredth (1/100) of 1% of the supply will be offered in the IEO. There will be no whales to manipulate the price by dumping millions of coins simultaneously. The whales will not have ANY coins. Period. The coin will be spread out in the possession of millions of people around the globe.
If the people use the coins as they are intended – as a medium of exchange – logic would suggest that FCC could gain many more millions of people in its network, and the coin could rise significantly.
Ultimately, what determines the value of any currency is the people using it.
Our aim is to doing everything humanly possible to let the free market decide the true value of FCC. If we can do that – free of interference and manipulation – we know that FCC will play a significant role in restoring honesty, freedom and value back into the public’s medium of exchange.