An Econometric Model to Estimate the Value of a Cryptocurrency Network: The Bitcoin Case

A blockchain is, in its essence, an unchangeable, inviolable and transparent database distributed among a network's participants. Far from simply representing the latest innovation in ICT, blockchain could serve as a foundation for the development of new business models. Indeed, its distributed nature opens the door to the creation of a new economy characterized by greater decentralization, transparency, security and privacy. The most well-known example of blockchain is the digital currency (or cryptocurrency) Bitcoin, which aims to revolutionize the world of payments as we know it today. The remarkable appreciation of Bitcoin's value over the years has been examined by numerous studies, most of which trying to determine what are the drivers influencing its price. This study is intended to provide some economic prospects for the future of blockchain technology, with specific reference to Bitcoin. In particular, this paper is focused on identifying the costs and revenues that the Bitcoin network supports in order to ensure its operativity. On the basis of the results emerging from this analysis, the paper addresses further considerations about the nature of cryptocurrencies and the future trend of their prices.