A new study has concluded that Metcalfe’s law may only be applicable to Bitcoin for the long term. In the short term, the researchers found the validity of the law to be “questionable.”
Metcalfe’s Law Only Good For The Long Term
A new study called Metcalfe’s law and herding behavior in the cryptocurrency market, authored by Danial Traian Pele and Miruna Mazurency-Marinescu-Pele has confirmed that Metcalfe’s law may only apply to Bitcoin’s network in the long term.
The law stipulates that the value of a network is proportional to the square of the number of connected users of the system.
The researchers analyzed blockchain data from 2010 to 2018 and their results also showed potential for herding behavior. This is why they also used Log-Periodic Power Law (LPPL) model to determine the behavior of cryptocurrency…