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The stock-to-flow model maker assures that Bitcoin will hit $ 100,000 in December 2021

November 9, 2020

Plan B, the inventor of the stock-to-flow (S2F) model, repeated this on November 8th Bitcoin (BTC) is on track to hit $ 100,000. The analyst expects the dominant cryptocurrency Reach the $ 100,000 to $ 288,000 range by December 2021.

Bitcoin would have to rise about 545% from its current price to break above $ 100,000. At that price, BTC’s market cap would approach $ 2 trillion, or roughly that of Apple, the world’s most valuable company.

Bitcoin’s S2F model. Source: PlanB

Why over $ 100,000 and why in 2021?

The S2F model attempts to predict the long-term price development of Bitcoin by evaluating its supply. That said, it takes into account your firm offer and halving the reward per block, thereby reducing the rate at which a new BTC is produced or “mined”.

The stock-to-flow model maker assures that Bitcoin will hit $ 100,000 in December 2021
The stock-to-flow model maker assures that Bitcoin will hit $ 100,000 in December 2021

The theory behind S2F is that if the supply of Bitcoin decreases over time, inflation will continue to rise. In theory, these two factors could fuel the major cryptocurrency’s uptrend.

Based on the Bitcoin supply curve and halving cycles S2F estimates the expected BTC valuation at $ 5.5 trillion. The model predicts that Bitcoin will reach a valuation of several trillion dollars by 2024. The model says:

“The S2FX model estimates the market value of the next phase / group of BTC (BTC S2F will be 56 between 2020 and 2024) at $ 5.5 billion. This corresponds to a BTC price (at 19 million BTC in the 2020-2024 period) of USD 288,000. “

In a tweet, PlanB said it remains confident that the $ 100,000 price prediction of the S2F model for Bitcoin will materialize..

2021 is especially important for Bitcoin as it follows the May 2020 block rewards halving.

Six months ago Bitcoin saw its third halving in history. This halved the amount of BTC depleted each day, which would cause the circulating supply to decrease over time. The analyst wrote::

“People ask me if I still believe in my model. To be clear, I have no doubt that #bitcoin S2FX is correct and #bitcoin will hit $ 100,000-288,000 before December 2021. In fact, I have new data to confirm that the supply shortage is real. IMO 2021 will be spectacular. This is not financial advice! “

So far, Bitcoin has increased from $ 8,700 to $ 15,500 after halving. A recovery of 78.1% was recorded in six months.

Daily chart of the BTC / USD pair. Source: TradingView.com

The Bitcoin supply is less than that of paper

Chain analyst like the creator of Woobull.com, Willy woosLet’s say that the total supply of Bitcoin is less than previously thought.

While the total supply of Bitcoin is $ 21 million, There is a large amount of lost or inactive BTC that can no longer be accessed. Courting said::

“The total supply of Bitcoin will not be 21 million, but around 17 million, as many coins died fighting for recognition as valuable in the early days. This means 0.002 BTC per person on the planet. “

For this reason, PlanB expects Bitcoin to follow the S2F model as the available supply and the amount of Bitcoin newly mined decrease over time.