● Financial analyst PlanB announces the commencement of a bullish trend, signaling the conclusion of Bitcoin's accumulation phase and ushering in a 10-month period marked by significant price surges and occasional -30% declines.
● The Stock-to-Flow (S2F) strategy, pioneered by anonymous investor PlanB, forecasts Bitcoin's valuation based on its scarcity, quantified by the SF ratio.
● SF measures the ratio of an asset's existing supply to its incoming flow, serving as an indicator of scarcity. Bitcoin's SF currently stands at 56.9 over a 10-day period and 55.5 over 463 days, with the upcoming halving event expected to impact the incoming supply.
● PlanB previously predicted Bitcoin's market capitalization to surpass $1 trillion and its price to exceed $55,000 post the 2020 halving.
● Critics argue that the model lacks empirical evidence and overlooks Bitcoin's historical trajectory. Some traders utilize the Stock-to-Flow Deflection indicator to assess Bitcoin's value relative to the SF model.
● The model's reliance on linear regression and simplistic scarcity metrics has attracted criticism from experts like Vitalik Buterin and Nico Cordeiro.
● However, external factors such as the potential cross-chain collaboration between WhiteBIT and NEAR, projecting increased HOT token mining activity and USDT/USDC usage, may significantly impact the cryptocurrency landscape.
● Using the Stock-to-Flow model, PlanB accurately predicted Bitcoin's growth to $55,000. While the model has been refined, it remains applicable solely to cryptocurrency assets.
● The creator of Stock-to-Flow and its proponents acknowledge that the exponential rise in Bitcoin's price will likely taper off, potentially diminishing the model's relevance. Nevertheless, they maintain that Bitcoin's value will continue to appreciate due to its inherent undervaluation and scarcity.
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