The Ethereum Investment Framework

We moved!!

You can download the Q1 issue of The Ethereum Investment Framework here: https://thedefireport.io/ethereum-investment-framework

The Ethereum Investment Framework is already in the hands of asset managers, hedge funds, VC firms, advisors, researchers, analysts, regulators, college professors, and crypto-curious investors globally.

We're making it the industry standard investment framework for evaluating the Ethereum ecosystem.

We believe crypto is on a clear path to becoming a universally accepted global asset class. With the birth of a new asset class comes new concepts for investors to understand. Things like the power of open-source technologies. Network effects. Lindy effects. Moore’s Law. Decentralized incentive structures. “Good enough technology” and “The 10-year window.” Why network technologies tend toward monopolies. The distinct phases that revolutionary technologies go through as they are implemented and deployed. The economics of Layer 2 solutions. The business model of each layer of the tech stack. Ethereum’s addressable market and “GDP.” On-chain financials, and much more. 

Furthermore, the business models in crypto are different. The KPIs, metrics, and benchmarks are different. The market & data structures are different. The governance & reporting structures are different. Custody is different. The assets themselves are different, as are the laws and regulations.

That's why we created The Ethereum Investment Framework. It's designed to save you hundreds of hours of research by combining everything you need to know into one document — in a non-technical, easy-to-navigate format.

Here's what it covers:

• The History of Open-Source Technology and Open Standards (and how crypto is simply the latest expression of these trends)
• The Distinct Phases that Revolutionary Technologies go through as they are Implemented and Deployed
• Why Digital Property Rights and Credibly Neutral Accounting Systems for the Internet are really important
• An Overview of Ethereum's Business Model
• Every data point across important KPIs dating back to Ethereum's inception
• A visual of the Ethereum Tech Stack (including an overview of the business models for each layer)
• A detailed analysis of Ethereum's Network Effect from a data-driven perspective
• Ethereum's On-Chain Financials from 2015 through Q4-23
• Value Accrual: ETH Holders vs Stakers
• Ethereum's Token Economics and Incentive Structure
• Valuation Frameworks & Addressable Market Analysis
• Valuation Scenario Analysis (base, bear, bull case)
• Valuation Metrics
• Ethereum's "GDP"
• Ethereum's network performance through cycles
• The Economics of Layer 2 Scaling Solutions
• Margins of applications/protocols built "on top" of Ethereum
• On-chain Gas Consumption by use case and year
• How firms such as Ernst & Young are onboarding enterprises to the Ethereum Network
• Ethereum as core Infrastructure for Global Finance
• The Composite Ether Staking Rate (by Coindesk Indices)
• Portfolio Construction
• Tokenized Real World Assets onchain (Treasuries, Private Credit, Real Estate)
• How Crypto and Traditional Finance are Merging on the Ethereum Network
• Why DeFi is here to stay
• How CBDCs could impact Ethereum and public blockchains
• New Internet Native Business Models Leveraging Ethereum (and the industries being impacted)
• Ethereum's Governance & Core Team
• Ethereum's Community and Social Presence
• Network Security and Decentralization
• Ethereum's Development Road Map
• Data-driven comps to Ethereum's top 10 competitors
• Ethereum vs Bitcoin and Solana
• Regulation
• Catalysts and Drivers of Adoption
• Private vs Public Blockchains
• Risks
• Glossary of Terms

The Ethereum Investment Framework was created for:

• RIA's (leverage our analysis and data to help inform your clients and client strategy)
• Family Offices (mandated to invest in or understand crypto assets? Leverage our data & analysis to get up to speed quickly)
• Hedge Funds (use our data & analysis to study and forecast performance through market cycles)
• VCs (leverage our analysis of the tech stack to forecast where value is likely to accrue)
• Crypto-Curious Investors (our non-technical, approachable guide will get you up to speed fast)
• Educators (use our framework to teach others about Ethereum both inside or outside of your organization)
• Web3 Natives (use our analysis to think through areas of the tech stack where the most value could accrue or where you might want to work)
• Financial Service Providers (learn how you could offer new products and services using Ethereum)
• Entrepreneurs (become inspired by what you could build by leveraging the Ethereum Network)
• Developers & Engineers (learn about Ethereum's user & developer base, tech stack, and network effects to inform where you should build)

In addition to creating The Ethereum Investment Framework, I'm also the founder of The DeFi Report — a web3 research firm, advisor to start-ups, and industry-leading newsletter trusted by over 5,500 readers ranging from investment banks, VC firms, hedge funds, asset managers, RIAs, regulators, crypto curious investors, educators, entrepreneurs, start-up operators, and web3 natives.

Cheers,

Michael

Disclaimer: The Ethereum Investment Framework is for educational purposes only and is not an offer to buy or sell Ethereum or any other digital asset. The information presented does not involve the rendering of personalized investment, financial, legal, or tax advice. Certain statements may constitute projections, forecasts, and other forward-looking statements that do not reflect actual results. Investments in digital assets and web3 companies are highly speculative and involve a high degree of risk. Past performance is no guarantee of future results. Please do your own research.