Yes, free cash flows are good but they only set the floor for the valuation of an L1. All institutions and managers that matter know and believe that L1s native assets matter more than just the cash flows they generate. And increasingly they're talking about security demand driving it. I wrote about this driver more than two years ago, over two different reports, and it is still the best way to understand this value driving force.
Kunal G
Kunal G7.12.2022
I've seen 50+ models to value crypto tokens but none of them really work imo. This is my attempt at a crypto-native model. Looking at L1 crypto assets as they are, without forcing a TradFi perspective on them. The Expected Demand for Security Model 🧵
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