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Does PlanB’s Latest ‘Red Dot’ Signal a New Bitcoin Bull Market?

1 min
Updated by Ryan Smith
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In Brief

  • The first 'red dot' on PlanB's Stock-to-Flow model for 2020 is out which has historically signaled a bull run.
  • If the S2F model is correct, Bitcoin should hit $100,000 between 2020 and 2022.
  • Some market commentators are not convinced of the price predictions.
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The very first red dot for 2020 of PlanB’s (@100trillionUSD) stock-to-flow model suggests the next Bitcoin bull market may already well be underway.
The Bitcoin halving has come and gone and the start of the new month also signals the release of 2020’s first red dot of PlanB’s now-infamous stock-to-flow model (S2F):
Bitcoin Stock to Flow S2F BTC
Chart credit PlanB (@100trillionUSD)

Bitcoin Heats Up

The anonymous Dutch creator behind the model believes that the Bitcoin price, in many ways similar to gold, can be tracked using the scarcity of its 21 million coins. The digital S2F model was developed early last year and thus has still been mostly unproven on its predictions of future prices. According to the model, previous bull runs coincide almost perfectly with the release of the first red dot (the first month after halving) which signals the long countdown until the next block reward halving. If the model rings true, Bitcoin could hit a mind-blowing $100,000 sometime between 2020 and 2022. In fact, PlanB’s latest analysis argues that BTC should outperform the model to reach $288,000 by 2024. Bitcoin

Not Everyone Agrees

Global macro markets commentator Alex Krüger (krugermacro) is not convinced the model holds up, at least not for price prediction: Bitcoin is well-known for its parabolic price moves, so the lofty target is not out of the question for the time frame. As anyone who’s been in the space long enough will tell you, ‘Past performance is no guarantee of future results.’ As the Federal Reserve continues to pump record amounts of liquidity into the system, it seems likely not a matter of ‘if’ but ‘when’ the Bitcoin price will once again take off.
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Ryan Smith
Ryan was BiC's U.S. Time Zone Editor until the end of Feb 2021. He is fascinated with the history and evolution of money and the role that crypto plays in fixing a broken financial system. When not meticulously looking over the charts, he can be found jamming some board games or running the trails in his local nature reserve.
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