From an update to a popular Bitcoin prediction model to pushback from Ripple on its sales of XRP, here’s a look at some of the stories breaking in the world of crypto.
The first analyst to apply the stock-to-flow ratio to Bitcoin has pinpointed a key date that will show whether the model is truly an accurate way to predict the price of BTC.
Stock-to-flow is often used to analyze gold. It calculates the supply of a given commodity divided by the amount produced per year in order to predict future value.
When using the ratio to forecast where Bitcoin may be heading, the leading cryptocurrency’s limited supply of 21 million coins becomes a key factor.
Using the model, the outlook from the anonymous analyst Plan₿ indicates BTC could hit $100,000 sometime around the year 2021 and break $1 million around 2025.
In a new interview with Real Vision, Plan₿ says we’ll know if the model is accurate or a bust if BTC reaches $100,000 by the end of 2021.
“Well, if we look at the stock-to-flow model, the only thing I can take from that is that taking the co-integration into account is that somewhere between a year and a year and a half after the halving.
So, say before Christmas of 2021, Bitcoin should be – should have been – above $100,000. If that’s not the case then all bets are off and it probably breaks down. I don’t expect it to happen, but that’s the big test that’s going. And I think a lot of people are waiting for that.”
Plan₿ says he thinks gold investors are taking a close look at Bitcoin’s performance and potential to become a so-called digital form of gold.