Capriole has developed a model to calculate the intrinsic value of bitcoin as determined by energy spent.
The current intrinsic value based on this approach is close to $81,000. Some highlights of this methodology: - Energy, raw Joules alone, can be used to estimate Bitcoin’s fair value - Increased energy input increases the fair value of a Bitcoin (and vice versa for decreases) - Bitcoin’s price is mean reverting to its Energy Value - The Energy Value model states that if all miners were to stop mining Bitcoin tomorrow, the power input would be zero and Bitcoin would be worthless This approach might be of interest for Pershing Square Capital Management founder and CEO Bill Ackman who turned some of his attention to Bitcoin on Saturday afternoon, cheekily suggesting a scenario in which the price for the world's largest crypto could soar far higher than anyone might imagine. "Bitcoin price rise leads to increased mining and greater energy use, driving up the cost of energy, causing inflation to rise and the dollar to decline, driving demand for Bitcoin and increased mining, driving demand for energy and the cycle continues," said Ackman in a post on X. "Bitcoin goes to infinity, energy prices skyrocket, and the economy collapses," he continued. "Maybe I should buy some Bitcoin." "The problem of course is that it also works in reverse," he later added. https://lnkd.in/eEd7D9gw Source: Capriole.com, Charles Edwards
Energy dependence and independence summarized in one chart
Source: JPMAM
Energy is the most de-correlated sector to Tech.
Source: BNP
NVIDIA is now bigger than the entire energy sector.
This makes sense because one is needed to get through everyday life. Source: Bloomberg
The big crocodile jaw...
No need for energy anymore?
With a $3 trillion market cap, Microsoft is twice the size of the entire energy sector in the S&P 500, which generates double Microsoft’s annual free cash flow.
Source: Tavi Costa
European natural gas prices have fallen massively from 2022 levels, so why is German manufacturing doing so badly?
Because - even with all the declines since 2022 - naturalgas prices are over 60% ABOVE their historical averages. That's a huge adverse energy shock hitting Europe. Source: Robin Brooks
Did you know that Brazil has been leading Latin America in solar panel purchases? 🤔
Source: Markets & Mayhem
