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Bear market gloom over? PlanB valuation model: Staying around $40,000 in September, aiming for $120,000 by the end of the year

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Bear market gloom over? PlanB valuation model: Staying around $40,000 in September, aiming for $120,000 by the end of the year

Bitcoin surpassed $48,000 today on August 14th, but quickly approached dropping below $46,000. The consecutive rise in the crypto market in recent days led many to believe that the pullback had ended. However, according to Bitcoin analyst PlanB's Stock-to-Flow (S2F) model, he estimates that Bitcoin's lowest point in September could reach $43,000.

Stock-to-Flow Model

The Stock-to-Flow (S2F) model for Bitcoin was proposed by the pseudonymous analyst known as PlanB. This model was first introduced in March 2019. PlanB defines Bitcoin as a digital asset based on a peer-to-peer (P2P) network, cryptographic algorithms, and proof-of-work, possessing scarcity. The Stock-to-Flow model is a valuation model that quantifies scarcity to estimate future prices. Typically, the higher the Stock-to-Flow ratio, the higher the asset's valuation.

Up to $135,000 in December

PlanB revisited his June tweets on Twitter, boasting that his August prediction was on target:

Bitcoin was below $34,000 due to FUD surrounding Musk's energy narrative, China's crackdown on mining, and fundamentally, the market weakness seen in July and August. My worst predictions for the year: August > $47K, September > $43K, October > $63K, November > $98K, December > $135K.

While Bitcoin has generally followed the Stock-to-Flow model trend upwards, the volatility remains significant, with price model upper and lower limits being very wide. Therefore, figures like Ethereum co-founder Vitalik Buterin and Bridgewater Associates founder Ray Dalio have publicly stated that the Stock-to-Flow model is not realistic.

In the past seven days, cryptocurrencies have seen a general increase of over 10%, with Ripple and ADA rising by over 50%, and Dogecoin by 37%.

Additionally, the listing effect on Coinbase has benefited from this uptrend, including:

  • Request Network REQ: 300%
  • Quickswap QUICK: 135%
  • Axie Infinity AXS: 58.5%
  • TrueFi TRU: 33.5%
Top ten cryptocurrency price increases.