The Only Law You Need to Know to Make a Fortune in Crypto

The Only Law You Need to Know to Make a Fortune in Crypto

One of the most important rules I’ve learned over my over three decades of covering the markets is this: When it comes to investing in new technologies, usage drives value.

This is the basic premise of Metcalfe’s Law…

If you’re not familiar with Metcalfe’s Law, it states that the bigger the network of users, the greater the value of the network.

Think of it this way: There’s no value in a telephone network if only one person has a phone. If a second person gets a phone, the network becomes a little bit more valuable.

But if everyone has a phone, the network becomes extremely valuable.

That’s when Metcalfe’s Law really kicks in…

It’s like a barrel of TNT… on top of a crate of nitroglycerin… on top of 100 tons of weapons-grade plutonium… exploding value higher and higher.

Take bitcoin, for example.

To hold bitcoin, you need a bitcoin wallet. So tracking the number of bitcoin wallets each year gives us insight into the network’s adoption rate.

In 2011, there were roughly 65,000 wallets on the network holding bitcoin. At the time, you could purchase BTC for $0.30.

Today, there are 53 million wallets. And a single bitcoin will cost you over $57,800.

That’s a 192,665% increase in value in 13 years – which would turn every $1,000 into $193 million.

The same thing happened with Ethereum. Take a look.