[ad_1]
Bitcoin (BTC) didn’t “crash” this weekend and is in fact performing exactly as expected, says the creator of the popular stock-to-flow price indicator.
In a tweet on March 8, PlanB analyst said that even though BTC / USD had dropped below $ 8,000, the downward pressure was actually a non-event.
PlanB: BTC price “still right”
Sharing the latest version of Bitcoin’s stock-to-flow forecast, he summarized:
“The #bitcoin S2F chart has been modified for today’s ‘crash’ … nothing really happened, btc is still in place on the S2F track.”
Stock-to-flow is a measure of where Bitcoin should go based on its existing supply – the stock – versus the “new” Bitcoins coming into circulation, or flow. The resulting report determines expectations, which predict that BTC / USD will hit $ 100,000 at some point in 2021.
Prior to the halving of the May block reward, which is expected to catalyze price growth, PlanB’s model requires substantially lower average readings, under $ 10,000.
Currently, the average 10-day and one-year stock-to-flow values are around $ 7,600, less than $ 200 below the spot price at the time of going to press.
Bitcoin stock-to-flow chart as of March 8. Source: PlanB / Twitter
As Cointelegraph reported, stock-to-flow proved extremely accurate in tracking Bitcoin’s journey. Despite this, in recent times PlanB has come under criticism from those who say that $ 100,000, in particular, is too optimistic.
Defending his reasoning, he argued that those opponents had failed to prove stock-to-flow wrong and to produce a viable alternative.
The “massive” difficulty increases on arrival
At the same time, PlanB noted that Bitcoin’s difficulty is set to increase on Monday, regardless of the price action.
The difficulty essentially represents the amount of effort required to validate the Bitcoin blockchain, with higher tiers implying greater participation from miners.
“No signs of weakness 2 months before the halving,” he added, describing the roughly 7% increase to new all-time highs as “huge.”
1 Year Bitcoin Difficulty Chart. Source: Blockchain
Bitcoin’s hash rate – a rough estimate of the implicit computing power miners devote to the network – hit an all-time high last week.
[ad_2]Source link
