Crypto News

Understanding the Stock-to-Flow Model The stock-to-flow model, created by PlanB, is a popular method of predicting bitcoin's future price based on its scarcity. The model calculates the ratio between the existing supply (stock) and new production (flow) of a commodity, in this case bitcoin. The higher the ratio, the scarcer the asset, and theoretically, the higher its price should be. Limitations of the Stock-to-Flow Model While the stock-to-flow model has gained a lot of attention, it is not without its limitations. Some critics argue that the model's accuracy is based on cherry-picked data and fails to account for other factors that may influence bitcoin's price. Others point out that the model has only been tested during a bull market and may not hold up during a bear market. The Power Law Corridor Model Recently, a new model has emerged that offers an alternative to the stock-to-flow model. The Power Law Corridor model, developed by pseudonymous analyst Wi...