The Bitcoin Stock to Flow (S2F) model, a popular price prediction tool in the crypto community, has regained attention as Bitcoin’s price trends align with its predictions. This resurgence of interest comes as Bitcoin maintains a steady position above $40,000, rekindling faith in models previously dismissed by skeptics.
PlanB, the creator of the S2F model, recently reiterated his model’s ambitious forecast of a $532,000 Bitcoin price post-halving, a prediction that continues to draw both awe and skepticism within the crypto community. He recalls facing doubts when initially predicting a $55,000 price for Bitcoin, a target that seemed far-fetched at the time.
The S2F Model’s Relevance
Originally published in March 2019, the S2F model evaluates Bitcoin’s price by examining the relationship between its production rate (flow) and the existing supply (stock), underscoring Bitcoin’s scarcity as a key value driver. According to recent data, Bitcoin’s price movements are aligning with the S2F and its 200-week moving average and realized price chart, hinting at an upcoming bull market phase.
Revalidation of the Model
Philip Swift, founder of LookintoBitcoin, recently observed that Bitcoin’s price has returned to the S2F line, lending credibility to the model’s predictions. PlanB himself notes that the model currently places Bitcoin’s value between $50,000 and $60,000, and he anticipates further price increases in the months leading to the halving.
Critiques and Realistic Expectations
Despite its renewed popularity, the S2F model has faced criticism for its sometimes overly optimistic predictions. For instance, in 2021, it projected Bitcoin would reach $135,000 by year-end, a target that was not met as Bitcoin peaked at $69,000.
Bitcoin’s Immediate Future
Currently, Bitcoin is experiencing a slight pullback, trading around $43,577. The $44K to $45K range has posed strong resistance over the past month. However, upcoming decisions by the U.S. Securities and Exchange Commission on spot Bitcoin ETFs could be a catalyst for further price movement.