Welcome to this weeks Just The Metrics

Hello and GM,

here is Just The Metrics, your weekly input on fresh crypto metrics, L1 comparisons, all about Cardano, and updates from the Cryptoverse.

And the best: all delivered as you explain it to your granny 👵🏻😄

Here's what we got this week:

1. Updates from the #Cardano Cryptoverse

• Building in the Bear Market

2. Diving into Just The Metrics

• The Just The Metrics-Framework to assess L1 PoS Blockchains

• Where to look for the right metrics?

Ok, let's dig in!

Cardano Keeps On Building In The Bear Market

The Bear Market can be mentally challenging:

the portfolios are down by 80%, the overall market sentiment is depressing, and scary news from big market players bankruptcy is everywhere.

But what happens if we change our perspective:

Crypto is not in a bear market, it is in a build market

Like Vance Spencer (Co-founder at Framework Ventures) said: “All of the best ideas really happen in the bear”

So we are officialy in the Golden Age of Building

With the noise of the bull market gone, the builders can finally concentrate and get back to what’s real and sustainable in the long-term.

Bull market fuel is built during bear markets.

During the 2018 bear market, DeFi came alive with only a "handful" of users participating in crypto.

In this bear market, we have millions of users and a new paradigm of cheap fees, way extended functionalities, and direct bridges connecting various dApps and networks.

Building is the best way to accrue value in a bear market. No matter if the price goes down, developers won’t stop building

What is built over the next two years will become the fundamentals that produce the next bull run.

So how is Cardano Building in the Bear?

There is one thing I often heard people say about Cardano: Cardano builds slow and steady. 

This exactly describes how they do it. No rush and break things. Cardano is running since 2018 without any network downs or 51% attacks very stable.

Also in this bear market, Cardano is constantly and reliable building up. Let´s check some numbers👇

According to data from Sanbase, the Cardano network emerged as the blockchain with the highest development activity in the last 30 days (Timestamp:

To track Cardano’s development activity, they use “the number of GitHub events that the project organization generated"

Among ten other coins, including Ethereum (ETH), Polkadot (DOT), and Solana (SOL), ADA had 362 activities, while ETH had 273.

But not only do the data of the last 30 days show high development engagement at Cardano.

Also if we look back at the bull market of 2021 the picture is accordingly: the total Developer Activities from 2021 are outperforming other leading networks with a total of over 140.000 events.

Additionally, there have been a total of 53 daily contributors to Cardanos Github repository registered.

So building is taking place, independent of the market conditions we are facing.

This is a promising outlook, also in times of a bear market, if you are here for the tech and not for the prices, right? 😉

Framework for Assessing an L1 Proof of Stake Blockchain

Crypto is an emerging asset class of the 21st century. And when making investment decisions in this particular asset class, it is important to not base them on hype or ever-changing narratives.

Especially in the light of recent events, it becomes more & more obvious that fundamental and metrics-based decision-making is key for a profound project assessment.

Don't follow the hype, follow the numbers

But the question is: What key metrics and fundamentals should investors be looking for when evaluating Layer 1 projects?

This is difficult considering the vast amount of potential growth variables; especially for smart contract-enabled blockchains that use a proof of stake Sybil protection mechanism.

The Blockchain Trilemma as Assessment Framework

But it's quite possible to make a fundamental analysis of Blockchains through the prism of blockchain trilemma.

A blockchain is a distributed database or ledger that is shared among the nodes of a computer network.

We have concluded that it's possible to look at certain metrics that determine the degree of

• Security

• Scalability &

• Decentralization

of an L1 blockchain to have a decent understanding of the overall value of a particular blockchain.

So this week we are describing the metrics related to each component of the blockchain trilemma that we would use in our framework to make the assessment.

General Decentralization Metrics:

• Initial token distribution metrics

• Number of individual staked wallets

• Permissioned vs Permissionless Mode (Yes/No)

• Total number of validator nodes/relay nodes/stake pools

Factors Enabling Decentralization:

• Size of a full node

• Minimum hardware & connectivity requirement for running a validator node/relay nodes/stake pool

The decentralization of a system is equal to the minimum decentralization of any of the components that makes up the system.

General Security Metrics:

• Client diversity

• Cost of 51% attacks

• Full Node/Partial Node Ratio

• Vulnerability to denial-of-service (DoS) and distributed denial-of-service (DDoS) attacks

• Propagation network types (a peer-to-peer propagation network or a relay propagation)

General Scalability Metrics:

• Transaction throughput

• Active Layer 2s (rollups/state channels)

• Transaction latency & finality time

Factors Enabling Scalability

• Status of data availability that enables rollups

• Number of projects building Layer 2s (rollups/state channels)

We believe that such a framework could give a basic understanding and provide an indication of the status-quo of a smart contract-enabled PoS public blockchain, regarding those 3 important cornerstones.

And it would be useful to conduct an assessment before making an investment decision.

This framework would be subject to change depending upon the availability of metrics and information regarding the individual blockchains. 

Where to Search for the right Crypto Metrics?

OK, as you might agree when you have subscribes to this newsletter: Metrics are essential for decision-making.

If you are looking for sources to conduct your research on crypto projects:

Here is your go-to list of Top 6 Crypto Research Sites & Tools 👇 📈

LunarCrush is amongst others a good source for free data on Sentiments & Social Media activities such as Engagement Ranks, Follower Ranks & Post Ranks. You will also find a list of Influencers that gives insights into a project's social sentiment.

Santiment is a Crypto Intelligence tool. Most people look at price charts. That's it. Sanbase (the database tool of Santiment) allows you to combine prices with other behaviors. You can see price + development activity + social trends. (and many other indicators)

Staking rewards is a very useful tool for looking into aspects of decentralization. It provides free insight into valuable metrics such as Staking Ratio and the Market Rank based on the Total Staked Value in the Network.

DeFiLlama is a DeFi Analytics tool. It provides an overview of available decentralized applications of the projects ranked by TVL & a dominance indication of the respective dApp.

If you are heavy into Alt Layer 1s, DeFiLlama helps to compare them through the Total Value Locked metrics.

CoinMarketCal is a cryptocurrency calendar that tells you about all the upcoming events for that project you have an eye on. Those events might impact the price or in general, represent an important technical milestone for the project's overall value.

Last but not least there are also project-specific data studios, providing transparency and insight into one single project. For Cardano, there is for example the Cardano Data Studio developed by @matiwinnetou

It provides a comprehensive source of data on:

• Transactions

• Staking

• Delegation

• Stake pools

• Social metrics &many more...

https://datastudio.google.com/u/0/reporting/3136c55b-635e-4f46-8e4b-b8ab54f2d460/page/k5r9B

This Isn't a Complete List. There are also additional tools that provide valuable insights like Glassnode, Trading View, Coingecko, IntotheBlock, etc.

But often less is more.

You should first be aware of your individual investing and trading style and what kind of data is appealing to you (very visual, aggregated, detailed charts, etc.). Then choose the respective tool accordingly.

Try out the free version first! That often provides already good insights and is a starting point before signing up for monthly plans.

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.#