The Stock-to-Flow model, a popular approach for valuing Bitcoin (BTC), suggests a potential peak price of $222,000 in this market cycle. However, André Dragosch, a research analyst at Bitwise, advises investors to remain cautious when applying this model.
Dragosch warns that the Stock-to-Flow model focuses solely on Bitcoin’s halvings, which occur every four years and reduce the supply of new BTC, without considering demand-side factors. He states:
“Today, institutional demand via Bitcoin exchange-traded products (ETPs) and treasury holdings outweighs the annualized supply reduction from the latest Halving by more than seven times.”
Investors debate the potential of Bitcoin’s price during this current market phase, especially with institutional involvement maturing the structure. Some analysts, like Geoff Kendrick from Standard Chartered, predict Bitcoin could reach $200,000 by the end of 2025, illustrating the mixed opinions surrounding BTC’s trajectory. The recent price drop in October might even signal a buying opportunity, prompting speculation about future highs for Bitcoin.
However, differing views persist, with critics like Mike Novogratz and Tom Lee voicing skepticism about Bitcoin reaching higher figures without significant market shifts.
In summary, the conversation around Bitcoin’s price predictions, investment strategies, and the effectiveness of the Stock-to-Flow model continues to evolve, revealing a complex landscape for crypto investors.
