Advance Basis

1. Implicit Value Analysis

The basis of the formula varies is accordance to the asset utility. The utilities are defined via,

$$(U_1, U_2,U_3,….)$$

The required variable that goes into utilities

$$P×T$$

P = Token Price

T = Token Required

$$P×T=U_1+U_2+U_3+….$$

$$P=(U_1+U_2+U_3+⋯)/T$$

​2. Discounted Cash Flow

This module is applicable on the basis that the token has a burning mechanism, or buy back mechanism

Assume, the buyback is represented by t, then the discounted cash flow for these buy back will be determine as $DFC_0$ at the time 0

Assume the market capitalization is constant (MC)

$$MC=P×S$$

S = Token Supply

P = Token Price

$$MC = (S-(DCF_0/P')×P'$$

$$P' = (MC + DFC_0)/S$$

​3. Value of Fiat: The Equation of Exchange

This equation shows the relations ship between money supply and the velocity of money, price level and index of expenditure.

$$M×V=P×Q$$

M=money supply

V=The Velocity of Money

PxQ= Nominal Gross Domestic Product

Example, we will apply the equation for Bitcoin

$$Mbtc×V= 〖Utility 〗btc$$

Multiply both side by BTC/USD

$$Mbtc×V×fx= 〖Utility 〗btc × fx$$

$$Mbtc×V×fx= 〖Utility 〗btc$$

$$fx= 〖Utility〗btc/(Mbtc×V)$$

The supply of btc is determined, the velocity is produced by its on-chain activity, the only variable required to determine the price of BTC/USD is be acquiring the utility factor of the asset.