Wednesday, December 8, 2021

Bitcoin price prediction model of $ 135,000 by next month “still in play”

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A price prediction model that gets Bitcoin on the way to reaching a six-digit figure before the beginning of 2022 is “still in the game” according to its creator.

Pseudonym Dutch analyst PlanB published the forecast for the first time in June when the BTC price was below $ 34,000 and has been within a few percent of each monthly target since then.

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The cryptocurrency hit $ 47,000 in late August before dropping to $ 43,000 in late September – both prices forecast by PlanB.

Bitcoin’s October closing price of $ 61,318 was slightly below the model’s forecast of $ 63,000, but there is renewed hope for the November target of $ 98,000 after BTC hit a new all-time high of over $ 68,000 last week -Dollars had reached.

Bitcoin’s recent price rally means it’s up more than 300 percent since that time last year, but the price will have to rise another 50 percent to meet PlanB’s forecast for November.

PlanB’s popularity rose along with Bitcoin price in 2021, gaining more than a million followers on Twitter after its stock-to-flow (S2F) model proved:amazingly accurate“.

The S2F model divides the supply (inventory) of Bitcoin by its production (flow) in order to estimate its market movements over the long term. The cryptocurrency’s built-in scarcity – only 21 million coins will ever exist – combined with its diminishing supply will, in theory, increase its value over time.

His most recent prediction success comes from his “worst-case scenario” for Bitcoin, which puts Bitcoin on track to hit $ 135,000 in December.

The simplicity of PlanB’s S2F model means it is prone to being derailed by “black swan events” like a leading economy enforcing a Bitcoin ban or key geopolitical news affecting traditional financial markets will.

He said The independent one Last month, bitcoin’s price could also be spiked by positive news like the approval of ETFs or another country following El Salvador’s lead by legal tender adoption.

Other analysts warn investors not to rely on the S2F model to predict short-term price movements.

“The model has been correct so far, but I would caution against following a model for such a volatile asset class,” said Mostafa Al-Mashita of digital assets company GDA Capital.

“Bitcoin can unite the global economy through a single asset class like no other. It can outperform and outperform the S2F model at any time. [but] We also have Kryptonite Black Swan Events that could paralyze Bitcoin in the short term. “

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