Co-founder of the Ethereum blockchain Vitalic Buterineshared his views on the ‘dangerous’ price model, which predicts that the Bitcoin price will reach as high as $288.00.
Ethereum creator Vitalik Buterin, who is often on the agenda for Bitcoin stock-to-flow (S2F) price modelHe once again described it as “harmful”.
Buterin quoted a tweet from Ethhub co-founder Anthony Sassano, who called stock-to-stream an “epic failing” and shared his views. Butern acknowledged that the price pattern “doesn’t really look good right now.” According to the founding partner, such models and financial models that share predictions that the price will rise are inherently wrong and deserve to be ridiculed in this regard.
Stock-to-flow is really not looking good now.
I know it’s impolite to gloat and all that, but I think financial models that give people a false sense of certainty and predestination that number-will-go-up are harmful and deserve all the mockery they get. https://t.co/hOzHjVb1oq pic.twitter.com/glMKQDfSbU
— vitalik.eth (@VitalikButerin) June 21, 2022
What is Bitcoin Stock-to-Flow Model?
on twitter PlanB The stock-to-flow model, developed by the analyst known by his name, is used to detect future movements of the Bitcoin price. The logic of this model is an estimate based on the circulating supply of coins issued each year. According to the blockchain mechanism, the issuance rate decreases by 50% every four years (halving).
Estimating that Bitcoin could hit as high as $288,000 by the end of 2024, the model suggests that Bitcoin’s scarcity, similar to gold and other commodities with limited supply, sets the stage for future value increases. However, the projected price tag of more than $100,000 was not achieved last year, deviating too drastically from the trendline he had predicted.
The S2F model predicts that in 2022 it will see Bitcoin price in the $100,000 and $110,000 range, but the recent market crash brought the price to an 18-month low below $20,000 last week, casting doubt on the model’s accuracy.
According to CoinMarketCap, Bitcoin is trading at $21,500 at the time of publication, up 5% from the last day.
PlanB, the inventor of the S2F model, was quick to respond to Buterin’s words, saying that the drop in the market is pushing some people to seek “scapegoats for failed projects or wrong investment decisions.”
After a crash aome people are looking for scapegoats for their failed projects or wrong investment decisions. Not only newbies but als “leaders” fall victim to blaming others and playing the victim. Remember those who blame others and those who stand strong after a crash. https://t.co/4nJdHq84pm
— PlanB (@100trillionUSD) June 21, 2022
According to PlanB, not only those new to the crypto space but also “leaders” tend to “fall victim to blaming others and playing the victim.”
“Remember those who blame others and those who stand strong after a crash.”
In an earlier tweet, he defended the S2F, arguing that the original model “definitely performed well” from March 2019 to March 2022.
#bitcoins S2F original 2019 model (grey) and newest fit on most recent data (white dots). S2F model certainly had a good run from Mar2019 (BTC 4K) to Mar2022 (BTC 45K). For now: either BTC is extremely undervalued and will bounce back soon, or S2F will be less useful in the future pic.twitter.com/JdnLINpzTV
— PlanB (@100trillionUSD) June 20, 2022
As for the current market, PlanB thinks that “either BTC is extremely undervalued and will bounce back soon, or S2F will be less useful in the future.”
You can follow the current price action here.
Disclaimer: What is written here is not investment advice. Cryptocurrency investments are high-risk investments. Every investment decision is under the individual’s own responsibility. Finally, Koinfinans and the author of this content cannot be held responsible for personal investment decisions.