Want to deflate the token bubble? Fix the market cap indicator.
Zach Herbert

Your example

“…there is currently a total supply of 25.6 billion Siacoin. In the next five years, the supply will have increased by 21.9 billion. Therefore the Siacoin inflation factor is (21.9 billion) / (25.6 billion) * 100% = 85.5%…

… This means that the total Siacoin supply will increase by about 85.5% over the next 5 years. Investors should factor this information into the current Siacoin price…”

Market Cap is mainly shown in USD, this is arrived at by converting the currently trading price of Siacoin (ignoring spreads) by multiplying it by the current trading price of BTC. As such the exchange rate of USD/BTC is also a factor. So in 5 years time what will be the the exchange rate factor, x2 or x4 or x10 or some other number. I think it’s safe to assume that it will be far more than double, which would account for BTC’s dilution and any more Quantitative Easing by the FED.

So today’s Market Cap in USD would have to be arrived at by estimating the Market Cap in 5 years and working that backwards by factoring coin supply inflation and the USD/BTC traded exchange rate in 5 years time which should also account for the changing supply in both those currencies too.

It would be fair to say that real numbers should be used, but due to the complexities of ‘what will anything in this space be worth in 5 years time’ I don’t think it so dangerous.

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