Despite the recent crypto market meltdown, the quantitative analyst known as “PlanB” still believes that Bitcoin is on track to hit $100,000 after the halving.
The analyst who popularized the stock-to-flow (S2F) model issued an update to his 76,000+ Twitter followers after claims that the model is no longer valid.
“Some people think S2F model broke yesterday. Of course it did not. Bitcoin oscillated nicely around model value and stayed well within model bands. The extreme volatility within the model bands shakes out the weak hands. No extreme returns without extreme risk (volatility).” Â
The wide range of the model bands accounts for Bitcoin’s extreme volatility. While the sell-off over the last few days is brutal, the king cryptocurrency did not deviate from the predicted price range of the S2F model.
In a recent Off the Chain podcast hosted by Morgan Creek Digital’s Anthony Pompliano, PlanB explains the fundamental idea behind the stock-to-flow model.
“Stock-to-flow is an attempt to quantify the digital scarcity invention that Satoshi made…Why does stock-to-flow work? Because it measures scarcity directly, like gold…The scarcer something is, the more valuable it should be.”
The halving is less than 60 days away. In spite of wild price swings, PlanB remains adamant that the top cryptocurrency is en route to $100,000 by 2021.
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