Bitcoin bull market ‘2nd leg has started,’ says BTC price model creator
Bitcoin (BTC) marking a new high of $67,000 last week has opened the possibility to hit $100,000 by the end of this year.
According to PlanB, the creator of the popular stock-to-flow (S2F) model, called Bitcoin’s price retracement from the $60,000-level the “2nd leg” of what appeared like a long-term bull market.
— PlanB (@100trillionUSD) October 26, 2021
In doing so, the pseudonymous analyst cited S2F that anticipates Bitcoin to continue its leg higher and reach $100,000-135,000 by the end of this year.
The price projection model insists that Bitcoin’s value would keep on growing at least until $288,000 a token due to “halving,” an event that takes place every four years reducing BTC’s issuance rate by half against its 21 million supply cap.
Notably, Bitcoin underwent three halvings so far in 2012, 2016, and 2020.
Each event decreased the cryptocurrency’s new supply rate by 50%, which was followed by notable increases in BTC price. For instance, the first two halvings prompted the BTC price to rise by over 10,000% and 2,960%, respectively.
The third halving caused the price to jump from $8,787 to as high as $66,999, a 667.50% increase. So far, S2F has been largely accurate in predicting Bitcoin’s price trajectory, as shown in the chart below, leaving bulls with higher hopes that Bitcoin’s post-halving rally would have its price cross the $100,000-mark.
PlanB noted earlier this year that Bitcoin would reach $98,000 by November and $135,000 by December of this year, adding that the only thing that would stop the cryptocurrency from hitting a six-digit value is “a black swan event” that the market has not seen in the last decade.
An 80% crash later
Despite the high price projections, Bitcoin should still see big corrections in the future. PlanB thinks the next crash would wipe at least 80% value off Bitcoin’s market cap, based on the same S2F model.
Related: COVID-19 vaccine will spark Bitcoin ‘crash’ — Rich Dad Poor Dad author
“Everybody hopes for the supercycle or the ‘hyperbitcoinization’ to start right now and that we do not have a big crash after next all-time highs,” the analyst told Unchained, adding.
“As much as I would hope that we don’t see that crash, I think we will. I think we’ll be managed by greed right now and fear later on… and see another minus 80% after we top out at a couple of hundred thousand dollars.”
But not everyone thinks the next correction will be as dramatic as the previous ones. Dan Morehead, the CEO of Pantera Capital, said mid-October that the next Bitcoin price drop would be less than 80%, citing a consistent drop in selling sentiment after each halving cycle.
Last week, Bitcoin (BTC) established a new record high at around $67,000 following a 53% rally in October so far. But the new highs prompted profit-taking among traders, resulting in retests of the $60,000 support level.
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