The Bitcoin exchange rate has been steadily above USD 9,000 for several days, the next important level is in the crosshairs of many traders – USD 10,000. Meanwhile, one of the recognized Bitcoin analysts, nicknamed ‘PlanB’, has published an update of his Stock-to-Flow (S2F) model.
The first red dot on the S2F chart
The S2F model is one of the valuation methods used to measure the scarcity of an asset. According to the model assumptions, the current Bitcoin supply divided by the annual production rate of the new amount of BTC that goes into circulation gives us a factor on the basis of which assets are valued by investors due to their shortage.
PlanB, which claims to be a member of the $ 100 billion asset management team, released an update of the S2F model for Bitcoin yesterday.
– PlanB🔴 (@ 100trillionUSD) May 31, 2020
The S2F coefficient for Bitcoin is now 50, for comparison: gold 62 and silver 22.
For the long-awaited update, the first red dot appeared to herald the start of the fourth growth cycle. The last, third cycle took place in 2017 and its result was an increase in the BTC rate to over 20 thousand dollars.
BTC for 100 thousand dollars
The 2017 cycle brought dozens of exciting projects in a wide range of fields, including payments, finance, games, infrastructure and web applications. “
What will the new, announced cycle bring us? The viewfinder shows the astronomical (at first glance) price of 100,000 USD for BTC, which PlanB itself announced at the end of last year.
Somewhere between a year and a half, after halving [maj 2020 rok], say before Christmas 2021, Bitcoin should cost or exceed USD 100,000. “
– comments PlanB.
If this does not happen, the entire S2F model and each prediction will need to be annulled and patched. Until now, S2F has worked perfectly. After the 2012 halving, the Bitcoin course reached its peak after eleven months. The Bitcoin ATH from 2017 was established after eighteen months, so the predictions made taking into account the S2F model were almost in line with the actual Bitcoin price.
Will it be similar this time? 100% nobody can predict it, but it’s worth taking into account the assumptions of the model.