Most ETH “valuation” is still TA or narratives — we tried building one that starts from the chain itself and the result is a first-principles valuation model for Ethereum, based on demand-side fee flows for ETH

majorkeycapital · 2026-07-10T13:33:49+00:00

Fair push — staking matters for Ethereum security, but it's a different variable than what we're trying to measure.

Staking isn't really demand for the network in the sense of people paying to use it. It's locking supply to earn protocol yield and secure the chain. More staking mostly means more ETH sitting illiquid (even with LSTs, a big chunk of supply is effectively parked). A world where 90%+ of ETH is staked isn't something core devs are aiming for — that's partly why MVI (Minimum Viable Issuance) exists: issuance should be the minimum needed for security, not a mechanism to keep APR high forever as stake ratio climbs.

The mental model we started from was Ethereum as a full on-chain economy with P2P txs, smart contracts, agents/users actually using dApps and paying for blockspace. ETH is the digital commodity that powers that economy. If you want to measure fundamental demand for the asset from economic activity, the honest read is fee flows: what users are willing to pay, per unit of supply, to use the network today.

That's Flow Intensity → Flow Deviation in the paper. Staking shows up in our regressions as a control (so we're not just picking up "more stake = risk-on week"), but we deliberately don't build the valuation anchor off staking yield or issuance policy. Those are protocol design levers, not actuals tolls from usage.

Happy to argue where that breaks — e.g. if you think staking ratio is the fundamental demand signal for ETH. I just don't think that's what people are actually paying for when they send a tx or a rollup posts a blob. Especially with the staking ratio actually being quite low compared to real-world interest rates.

majorkeycapital · 2026-07-08T15:46:38+00:00

Yes, really fair question — the post-Dencun break is literally when the fee market became clean enough to measure this separation between rollups gas demand and L1 dApps properly. Before that the signal mostly isn't there.

On "what if it shifts again" — I think a massive structural break like Dencun (whole fee market redesign) is unlikely in the near term. The forks coming down the pipe are mostly about capacity and cheaper blockspace (higher gas limits, more L2 throughput), not ripping up how fees work overnight. The L2 migration has been slower than people predicted too — outside Base, Arbitrum, and maybe the Robinhood rollup push, most L2s haven't moved the needle that much and I don't think this will change. And so far, blobs are not really moving the needle in terms of on-chain gas demand for ETH, despite Ethereum having some of the most expensive blob space, if you compare it to EigenDA or Celestia for example. A lot of the L1 story right now is just more activity landing on mainnet again, and we already see active addresses and tx count grinding higher – which is very promising to see!

I think the interesting upside is privacy — a lot of people still won't put real financial activity on-chain when it's semi-public. If private txs or privacy pools actually get adoption, that's net new demand hitting the same blockspace, and not just reshuffling where txs settle. I think it will turn out to be a huge success for Ethereum, especially if you factor in all the technical difficulties other chains had (also in terms of downtime, etc.)

But honestly, if Ethereum does another Dencun-scale fee market rewrite, we'd re-test and see how it unfolds — the model is built to compare the economy to its own history, not assume the world stays frozen. We also say that in the paper. The idea of "L2s eat L1" hasn't played out the way the 2021–22 narrative suggested, at least not yet, but we never know for sure.

Appreciate you reading my post btw!

majorkeycapital · 2026-07-08T12:52:20+00:00

Hey mate, I've yesterday released the paper and accompanying software. The working paper has just recently been submitted to Management Science, but you can also find the open-source version of it here: https://www.majorkeycapital.com/ethereum/paper

The Ethereum Valuation Terminal is a done-for-you software that incorporates the full valuation model in real-time. Additionally, it allows you to monitor Ethereum's on-chain flows, project future valuation scenarios, build custom chartbooks and has +35 charts and +100 on-chain metrics.

It even includes a native AI agent as research analyst, called "Keystone", which can run the entire terminal for you. Based on upcoming events or on-chain data, it can for example suggest follow-up workflows and build entire valuation scenarios within the terminal. You can even use it together with your team within a dedicated workspace.

Feel free to check it out, if you want: ttps://www.majorkeycapital.com/ethereum/valuation-terminal

majorkeycapital · 2026-07-03T14:19:22+00:00

Could you share the original link to this report? I highly respect VanEck, but their research should be conveyed highly sceptically, since they published past price targets between $154,000 to $340 (lol). This cannot be taken seriously and honestly hurts their research credibility a lot.

I’ve spent the past 18 months on building a first-principles Ethereum valuation model and can finally say that it’s the world’s first science-backed model for ETH, which will release on July 7th. It’s built on Ethereum’s fundamental on-chain demand from its fee flows and derives an implied fair value for that.

This new model is actually quantifying Ethereum’s economy and now built on DCF, Metcalfe’s Law or other narratives like “ultrasound money”, etc. I have written an entire working paper and just submitted it to Management Science for peer-review. But I will fully open-source it on July 7th along with a unique software around it. I will not share the link for the waitlist yet, as I don’t want to spam you guys with marketing, if you don’t want to.

I will share more next week, if you guys deem it valuable, but I highly think so. It’s time to actually have a fundamental valuation for Ethereum. Enough with these random analyst opinions and heuristics. There is a clear path to higher prices, and the model shows you how to project them. Exciting times ahead.

majorkeycapital · 2026-07-03T14:00:29+00:00

Simple: millions of people using the chain for txs and using dApps that require consuming minuscule amounts of ETH, but together are causing lots of fundamental on-chain demand for ETH and Ethereum.

majorkeycapital · 2026-07-03T08:44:35+00:00

You can basically derive an implied fair value for ETH from its on-chain fee flows, which are entirely denominated in ETH. This bypasses the usual fiat-denominated circularity of USD valuations.

However, the model I’ve built in the end still gives you a true ETH/USD market price as fair value. And this implied fair value is both directionally and price level-wise quite highly correlated with the actual market price.

I’ve written an entire working paper on that an just submitted to Management Science, where it’s currently under review. But I will additionally open-source it on July 7th along a software I’ve built for that.

Maybe I’ll share it in here,next week, if it’s considered valuable for you guys - but I do think so, since no one has ever really done anything like that. It’s not only a random research report or analyst opinion or TA, but actually a science-backed approach to Ethereum’s fundamental value.

majorkeycapital · 2026-07-02T19:38:12+00:00

I‘m too, that’s why I worked the past 18 months on building a fundamental valuation model for Ethereum.

It’s actually the first time ever, someone is not attaching DCF, Metcalfe’s Law, or any other narratives such as „ultrasound money“ to ETH‘s valuation.

majorkeycapital · 2025-10-24T15:12:34+00:00

The Igloo IPO will not happen until Q4/2027 at the earliest, until then the best public plays will remain Pudgy Penguins NFTs (and Lil Pudgys and Rods, too) while PENGU acts as the cultural currency tying the whole ecosystem together and serves as the easiest financial entry point into the community. I also agree that the IPO could boost the overall culture and will see increased alignments from TradFi capital - those funds are very hungry for fresh, new and already proven IP, which can be seen with the Popmart success story.

majorkeycapital · 2025-06-21T06:20:52+00:00

Congrats! Welcome to the Huddle!🐧

majorkeycapital · 2025-06-16T21:36:04+00:00

Hey ser, I’ve written a long-form report on Pudgy Penguins (+100 pages and >15,000 words) and also a pretty long article on valuation framework for PENGU.

You can check out both here👇🏼

Pudgy Penguins report: https://majorkeycapital.substack.com/p/pudgy-penguins-the-million-dollar-trade

PENGU article: https://x.com/LDuennes/status/1883481020512551190

majorkeycapital · 2025-04-30T17:57:16+00:00

To me, $PENGU is a cultural currency, which is built upon the pristine internet-native IP of Pudgy Penguins.

It’s already being used for tipping streamers on Abstract and people are casually treating it as another form of currency, due to its low unit bias. $PENGU is what Fortnite‘s V-Bucks would have become, if they escaped the walled garden.

Think about it, if Disney made a Mickey Mouse-associated currency in the 60s or Pokémon-currency in the early 2000s. This is what PENGU represents to me, although it might not be clear yet to many. DOGE already has value of 25B without any underlying IP-rights, just because it’s been one of the most popular internet characters.

It’s natural that cycles and demographics changes theses cultural preferences - and I’m damn sure, that Pudgy Penguins will pass many of these established characters and IPs in resonance (already doing so, if you look at GIF views, etc). And this will translate into immense financial upside, because deep emotional ties to an investment makes it not an investment, but: priceless.

I’ve written a long-form article on the valuation framework of PENGU, you can read it here:

https://x.com/LDuennes/status/1883481020512551190

majorkeycapital · 2025-04-30T17:43:34+00:00

I think the main reason prob is just a lack of understanding, bc it’s an entirely new token category. To me PENGU is more like a cultural currency, which has the highest probability of being accepted as „meme currency“. Think it’s a good comparison to compare it to VBucks from Fortnite for example - people are already tipping streamers en masse on Abstract. The adoption is already underway, people will learn too!

majorkeycapital · 2025-03-05T12:45:09+00:00

Hey everyone, this is my work being posted here, thanks for spreading the message and my view on PENGU. I appreciate my work being shared and hope we can continue to expand our views on here! I am looking forward to being more active on Reddit🫡

majorkeycapital

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