Few in the Bitcoin industry have not heard of PlanB. The pseudonymous analyst, who works at a European institution managing a multi-billion-dollar balance sheet but moonlights as Bitcoin analyst, has garnered tens of thousands of followers and presumably millions of views of his articles and tweets.<\/p>\n
The reason: he's the creator of the stock-to-flow model, an econometrics model that suggests Bitcoin's value is primarily derived from its level of scarcity, defined by the inverse of its inflation rate.<\/p>\n
The model, which has been backtested to have an R squared value of 95 percent (extremely accurate), suggests Bitcoin will have a value of $55,000 to $100,000 after May's block reward halving.<\/p>\n
While PlanB's model has become popular as many believe it is sound,<\/a> some have started to push back.<\/p>\n Over the past few days, Hugo Nguyen, a crypto writer and a 2019 resident at Bitcoin development firm Chaincode Labs, has been waging war against those who fully put their faith in the stock-to-flow model.<\/p>\n It began when he said<\/a> that \u201canyone using the ridiculous S2F price model and consider flow to be effectively non-zero is just silly,\u201d adding that halvings in the future will be \u201canticlimatic and increasingly a historical relic.\u201d<\/p>\n He doubled down in a Twitter thread<\/a> published Apr. 13, explaining that “Bitcoiners who popularize the model [are using] a lazy and irresponsible way to cause FOMO.” He added<\/a> that he thinks the model is predicated on “2 pathetic data points,” referencing the fact that there have only been two prior halvings, and a “generous margin of error.”<\/p>\n I maybe over my head, but let me say this.<\/p>\n Bitcoiners who popularize S2F price model no longer evangelize Bitcoin based on its technical merits, but a lazy and irresponsible way to cause FOMO. That\u2019s a cop-out. 1\/ https:\/\/t.co\/JWsHur08te<\/a><\/p>\n — Hugo Nguyen (@hugohanoi) April 13, 2020<\/a><\/p><\/blockquote>\nStock-to-flow model deemed “irresponsible” by analyst<\/h2>\n
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