Bitcoin fell since yesterday, and at the moment of writing this article, the most important coin in the crypto market is trading in the red, and it’s priced below $8,900.
BTC indicator is not reliable enough
A popular cryptoanalyst said that a model that is used more and more in order to predict the price of BTC is getting too much attention, at least definitely more than it deserves.
Alex Kruger said that the stock-to-flow ratio, which tracks the circulating supply of an asset against the amount produced per year, “is not a reliable tool to determine where BTC is heading in the long run,” as reported by the online publication the Daily Hodl.
He said that the model which is predicting that BTC will hit $1 million by 2025 is definitely flawed.
“Amazing how so many bring up S2F these days whenever anyone mentions bitcoin supply. I did not have S2F in mind when I wrote this tweet, and no, I don’t think it is very important, it is massively over-hyped,” he said.
He continued and stated that “The Stock to Flow model is to bulls, what the Tether Manipulation paper is to bears. Both based on fancy looking statistical models (more so the latter). Both are flawed. Doubt whoever believes in these extremes will change their minds. The mind believes what it wants to believe.”
Kruger also said that BTC is a demand-side story and the supply is entirely deterministic:
“Fixed total supply and diminishing supply growth are crucial because these drive demand. It is that simple. Demand is what matters most.”
Bloomberg says BTC pullback is in the cards
Just the other day, we were reporting that the latest reports coming from the Daily Hodl reveal that The Global Strength Indicator shows BTC is entering the overbought territory, reports Bloomberg.
It’s been revealed that BTC’s current trajectory is mirroring BTC’s movements in August just before its price fell from about $12,000 to $10,000.
It’s been also reported that crypto analyst DonAlt believes that Bitcoin needs to hold support at $8,300 in order to avoid a further fall.
