What Is Thermocap?
Thermocap (or Thermocapitalization) is the total cumulative revenue paid to miners throughout a cryptocurrency's entire history. It represents the total economic cost of producing and securing the network — the "thermal energy" expended. For Bitcoin, Thermocap is calculated by summing all block rewards and fees at the BTC price when each block was mined.
How Thermocap Works
The Thermocap Multiple (Market Cap / Thermocap) measures how much the market values the network relative to the cost of producing it. High multiples (above 64) historically indicate overvaluation — the market is paying far more than the cumulative cost of security. Low multiples (below 8) indicate undervaluation.
Why It Matters for Traders
Thermocap provides a fundamentals-based valuation floor. Since it represents real economic expenditure (electricity, hardware, opportunity cost), it's a "hard" value that the network has objectively consumed. Buying when the Thermocap Multiple is low means paying close to the production cost of the network — historically one of the best risk-reward entries.
