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Another useful analytic tool is the market cap ratio between LINK and Bitcoin. Market cap, calculated by multiplying an asset's price by its circulating supply, provides a snapshot of the overall value assigned to a token. By examining the ratio of Chainlink’s market cap to that of Bitcoin, one can comprehend its potential relative valuation, especially after accounting for the increased circulating supply of LINK since the last bull market.
While both methods of valuation hold merit, the market cap ratio offers a more balanced perspective on LINK’s potential trajectory, particularly considering the inflation within its supply. With more circulating tokens than previously, a larger influx of capital would be required to elevate Chainlink's price to reach levels seen in the last cycle.