A former Bloomberg analyst says that fundamental blockchain analysis points toward the notion that crypto is headed towards mainstream adoption.

In a new thread, Jamie Coutts tells his 10,600 followers on the social media platform X that Metcalfe’s Law – which states that the value of a communications network is proportional to the square of the number of connected users in its system – is at the heart of the new analytics method.

According to Coutts, the data shows that Bitcoin’s user base grew in 2022 and 2023 despite dips in BTC’s price, signaling an upward trajectory of mainstream adoption.

“Blockchain fundamental analysis is a new field, an open design space for the intellectually curious. But at its core are the long-standing, well-accepted principles of network theory, or Metcalfe’s Law, which states the value of a network is proportional to the number of nodes/users and interconnections.

Daily Active Users (DAUs) for smart contract (SCP) blockchains keep hitting new ATHs (all-time highs) – currently 6.34 million (30-day average). Meanwhile, the aggregate market cap for these networks is still 40% below the 2021 peak.

Unlike previous bear markets, more users came into the ecosystem in 2022/23 despite wicked drawdowns in prices. This is the global adoption of crypto on a trajectory to mainstream adoption. This is the signal. Be the network, own the network.”

Earlier this week, Coutts said that one on-chain indicator suggests Bitcoin (BTC) could reach a minimum price target of $100,000 by 2025.

The analyst noted that he’s been keeping an eye on Bitcoin’s MVRV (market value to realized value) Z-score, which aims to measure whether BTC is “undervalued” or “overvalued” by comparing its market value to its realized value.

“Bitcoin is now ahead of [the] previous two cycles on price performance. MVRV Z-score topped above six last cycle. If cycle moderation continues, then 4-5 standard deviations seems fair this cycle, implying a BTC price of $100,000 [minimum] by 2025.”

Bitcoin is trading for $61,660 at time of writing, a 8.5% increase during the last 24 hours.

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