[ad_1]
Popular Bitcoin analyst and creator of the stock-flow pricing model, Plan B, last month explained that he believes the “bull is not over.” On August 6, Plan B still trusts its forecast and reconfirmed its post from last month. Meanwhile, bitcoin prices were able to rebound and on Sunday bitcoin prices hit a high of $ 45,355.
Plan B Shows Confidence In Previous Forecast As Bitcoin Prices Hit New Highs
Bitcoin (BTC) has been in tears of late and oddly enough in the face of regulatory uncertainty in the United States. BTC has gained over 11% in the past seven days and 30-day statistics show the main crypto asset is up 31% against the US dollar. Since trading opened on August 5, at $ 39,734 per BTC, the crypto asset has gained 12.97% in three days. Moreover, following the bullish action, the infamous pseudonym operated by the Twitter account @ 100trillionusd, also known as ‘Plan B’, seems more confident that the bitcoin run is not over.
Bitcoin.com News has reported on the outlook for Plan B on several occasions since it began documenting its popular stock-to-flow (S2F) pricing model in March 2019. The incognito analyst has also updated the S2F pricing model to stock-to-cross-asset flow model (S2FX).
On June 1, Bitcoin.com News explained how Plan B believed the S2FX model was still intact and claimed it was starting to look like 2013. A number of analysts have compared this run to the bull run of 2013 because during this period, BTC saw a double top.
On August 1, Plan B explained that the capitalization achieved by BTC was on the rise and, in its opinion, things looked bullish. “Bitcoin’s realized cap rises again”, Plan B noted. “The realized cap is the average price at which all 18.77 million BTC were last traded (calculated over all UTXOs). In addition, the few sellers at the moment are selling at a profit (not at a loss like in May and June). IMO, it’s bullish.
At the time of going to press, the number of Bitcoin (BTC) in circulation today is 18,779,913 BTC and the halving is expected in just over 1,008 days. At that time, issuing BTC will become much rarer, as the block reward of 6.25 coins per block will be reduced to 3.125 coins per block after halving.
Plan B’s S2F or S2FX is all about scarcity, and essentially the low issuance rate and scarcity of the crypto asset should bolster the value of BTC in the long run. Basically, stock-to-flow measures the abundance or lack of long-term issue rates of BTC. The current amount of BTC (stock) is simply divided by the number of bitcoin produced (flow) on an annual basis.
In Plan B’s original thesis, he also published a table of other commodities like precious metals (gold and silver) to describe how the S2F model works with different commodities. Gold has historically shown the highest S2F ratio, at least in terms of commodities like precious metals.
Bitcoin, on the other hand, has a much higher S2F ratio, which means that in the long run the crypto asset either retains its value or increases due to high demand. In 2019, when Plan B released its original model, it added that “gold and silver, which are totally different markets, are in line with the bitcoin model values for SF.” The analyst also pointed out that there was an “indication of a power law relationship”. The pseudonymous analyst added:
The model predicts a bitcoin market value of $ 1 billion after the next halving in May 2020, resulting in a bitcoin price of $ 55,000.
Plan B: “August will close above $ 47,000”
After May 2020, the price of BTC exceeded $ 55,000 per unit area and the market valuation also climbed over $ 1 trillion in aggregate value. Since then, the price of BTC has dropped significantly on two occasions, but Plan B is still confident.
On August 6, plan B re-tweeted an older tweet he posted on July 2 and said: “Just to reconfirm that post from last month.” Around this time, Plan B said he believed the bull run was not over and today it seems like he’s pretty sure his old statement from the first week of July still rings true. Plan B noted:
My chain data (color overlay in the graph below) tells me that this bull isn’t finished and 64K wasn’t the top. It is in accordance with [the] S2F (x) model. In addition, my bottom indicator (not based on S2F) indicates that we will not go below $ 47,000 at the August close.
Plan B clarified that the floor estimator was not based on S2F when a person asked the analyst for a question. “So August will see the price exceed 47,000?” Is that what you mean? “Asked the Twitter account dubbed” Crypto Storm. “August will close above 47k. Ps, this floor estimator is not based on S2F ”, Plan B responded.
What do you think of the current assessment of Plan B? Are you a fan of the S2F or S2FX price models? Let us know what you think of this topic in the comments section below.
Image credits: Shutterstock, Pixabay, Wiki Commons, bitcoinwisdom.io,
Warning: This article is for informational purposes only. This is not a direct offer or the solicitation of an offer to buy or sell, nor a recommendation or endorsement of any product, service or business. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or allegedly caused by or in connection with the use of or reliance on any content, good or service mentioned in this article.
[ad_2]
Source link