In this episode of Empire, Jason hosts Dan Smith and Jonah Weinstein to discuss the challenges of valuing Layer 1 (L1) tokens and the need for better valuation metrics. The conversation explores the shortcomings of existing metrics like TVL, and introduces REV (Revenue) and RSOV (Realized Store of Value) as potential frameworks. The discussion revolves around whether L1 tokens should be viewed as companies, commodities, or a form of money, with emphasis on the importance of capital inflows, staking, and DeFi activities in determining token value. The speakers debate the role of transaction fees, the impact of scaling solutions, and the psychological aspects of users denominating value in native tokens versus dollars, ultimately aiming to refine a model that accurately reflects the bet investors are making when buying L1 tokens.
