Stock-to-flow creator PlanB: Bitcoin is just getting started

Stock-to-flow creator PlanB: Bitcoin is just getting started

While Bitcoin continues to wait for impulses after the high rush, the price forecasts are outbidding each other. 100,000 or rather 400,000 US dollars in 2021? PlanB and Mike McGlone are not baking small rolls.

The crypto market has been hit by the sell-off and is losing ground at the beginning of the week. Total market capitalisation slips 1.4 per cent on the day to US$1.77 trillion. With the exception of THETA, which is today’s Bitcoin Machine crypto market spearhead with a 24-hour gain of 11 per cent, and Litecoin (LTC), the ten largest cryptocurrencies are posting moderate declines ranging from 0.1 per cent for XRP to 3.4 per cent for Binance Coin (BNB). The cryptocurrency Bitcoin slipped by 1.9 per cent to 55,132 US dollars at the time of going to press, but has been defending the one trillion US dollar market capitalisation mark again since Friday

Thus Bitcoin falls back by 4.2 percent in a weekly comparison. After the record rush, the market is currently cooling down further. At the same time, Bitcoin performance, at least according to the stock-to-flow creator PlanB, is still fully on track. According to the analyst, the end of a bull market is still a long way off:

Bitcoin is just getting started.

He uses his not uncontroversial price calculation model as a basis. The stock-to-flow model is a forecast that calculates the Bitcoin price in relation to the supply shortage caused by the cyclical halvings that occur. The bullish model, criticised by critics as being coarse-meshed, has proved surprisingly accurate, at least in view of the recent rally. According to it, the largest cryptocurrency is heading straight for the next level: 100,000 US dollars.

IMO we are only ~4 months into the bull market and nowhere near the end of it … #bitcoin is just getting started
– PlanB (@100trillionUSD) March 26, 2021

Bitcoin on its way to becoming a store of value

Mike McGlone, senior commodity strategist at Bloomberg, shares a similar price forecast. The economic expert even considers a far greater price jump possible.

Via Twitter, McGlone explained that „Bitcoin is in transition to a risk-free reserve asset“. As a „global digital reserve asset“, confidence in the long-term performance of Bitcoin is growing steadily on the part of institutional investors. So far, it is mainly arguments such as enormous volatility that have kept investors with purchasing power from investing in the crypto asset. However, as the price stabilises with increasing capital inflows, i.e. the volatility gradually decreases, this mistrust could gradually disappear.

#Bitcoin in Transition to Risk-Off Reserve Asset: BI Commodity – Well on its way to becoming a global digital reserve asset, a maturation leap in 2021 may be transitioning Bitcoin towards a risk-off asset, in our view.
– Mike McGlone (@mikemcglone11) March 26, 2021

The price level at the end of the graph above is no less than $400,000, this year mind you. An exceedingly bold prediction, but one that does not seem entirely out of the question given its increasing appeal to large investors. The „maturation leap“ anticipated by McGlone is already taking place, in that the narrative is shifting from Bitcoin as a speculative object to a store of value. The coming months will show whether the promise will be realised.