Renowned quant analyst PlanB has made significant predictions for Bitcoin (BTC), asserting that the cryptocurrency is poised to witness a remarkable expansion, potentially rivaling some of the most prominent asset classes. With a considerable following of 1.8 million on Twitter, PlanB’s insights are closely monitored by investors and enthusiasts alike. Let’s delve into the analyst’s compelling perspectives on Bitcoin’s journey and the potential market implications.
Bitcoin’s Early Bull Market Phase:
PlanB is confident that Bitcoin is currently in the early stages of a bull market, referred to as the “stage-1 early bull market” (blue phase). Notably, he highlights the interest of major players like BlackRock, who may seek to capitalize on the relatively lower prices before Bitcoin enters a full-blown bull market and gains significant momentum. Such large-scale accumulation by institutions could potentially occur just ahead of ETF (Exchange-Traded Fund) approval, fueling the crypto’s rise.
The Significance of Stock-to-Flow (S2F) Model:
PlanB is renowned for popularizing the stock-to-flow (S2F) model, a key indicator used to gauge the scarcity of an asset. By assessing the newly created supply of an asset over time relative to its existing supply, the S2F model offers insights into Bitcoin’s value proposition. Following the next halving event, which slashes the newly issued BTC to miners in half, the S2F model suggests that Bitcoin’s scarcity will surpass even traditional assets like real estate and become increasingly undervalued compared to commodities such as gold, silver, and diamonds.
Bitcoin’s Undervalued Potential:
Drawing comparisons between Bitcoin and other assets, PlanB emphasizes the astonishing undervaluation of the cryptocurrency. With an S2F of 58 and a market value of $400 billion, Bitcoin appears undervalued when compared to the S2F values and market sizes of gold, diamonds, and silver. PlanB notes that gold’s S2F is approximately 60, with a market value of approximately $10 trillion, indicating Bitcoin’s potential for exponential growth. Similarly, diamonds (S2F ~40, market value ~$1 trillion) and silver (S2F ~30, market value ~$500 billion) exhibit even more significant disparities.
Price Projections for Bitcoin:
In a recent strategy session, PlanB predicts a bullish surge for Bitcoin, with the price potentially reaching around $50,000 as the cryptocurrency approaches its next halving event. Based on the 200-week moving average, PlanB estimates that the price of Bitcoin at the 2024 April halving could be around $32,000. However, considering historical trends, Bitcoin’s price tends to be about 50% above the 200-week moving average during halvings, indicating a potential range of $40,000 to $50,000 for Bitcoin at the time of the next halving.
PlanB’s optimistic outlook for Bitcoin’s future has sparked interest and discussions among the crypto community. As Bitcoin continues to gain mainstream recognition and adoption, investors are closely monitoring its trajectory and potential for massive expansion. The S2F model and the upcoming halving event add to the intrigue, making Bitcoin an exciting asset to watch in the coming years.
