Like going back and look at the fundamental business case of crypto:
This is possible by considering blockchains as businesses that sell space on the ledger .
Except we don’t earn any money for selling that space, so blockchains can’t be businesses. It would be another thing if transaction fees were revenue that went to a company that develops and markets the blockchain, but then it wouldn’t be decentralized, and would lose the deflationary aspect of the fee.
I’m the author, the trad-fi valuation model is only used to isolate the net benefit a blockchain provides accounting for the economic costs of the chain and the value it provides to users. If there is a positive net benefit, it is the choice of the chain and its design to distribute that back to holders of the native asset or just to validators, either way, there is someone earning the fees paid. Most chains choose not to, because they end up paying all of it to the security budget anyways.
@P_Patil Great article! You write:
“Expressivity: Much like Metcalfe’s law, but the idea that interesting transactions happen not only as you scale nodes, but also as you add more types of transactions or more expressivity (e.g. Turing completeness). This doesn’t really have some analogous expression like the other two and is much more qualitative and relative.”
This concept is known as The Long Tail. From Wikipedia:
“The book argues that products in low demand or that have a low sales volume can collectively build a better market share than their rivals, or exceed the relatively few current bestsellers and blockbusters, provided the store or distribution channel is large enough. The term long tail has gained popularity as describing the retailing strategy of selling a large number of different items which each sell in relatively small quantities, usually in addition to selling large quantities of a small number of popular items. Chris Anderson popularized the concept in an October 2004 Wired magazine article, in which he mentioned Amazon.com, Apple and Yahoo! as examples of businesses applying this strategy.”
So basically if people come for a niche use case, enabled by expressivity, they will also stay for the popular use cases.