As the next Bitcoin halvening is to take place in a few months (May this year), more people are beginning to talk about it and its possible impact on the price of the flagship cryptocurrency.
‘Halving is priced in correctly, markets are efficient’
The analyst PlanB believes that the halving is priced in and uses a stock-to-flow model to predict the price. However, he reckons that only 10 percent of market participants can understand this model and maths behind it.
On the chart, PlanB has used a lower figure for predicting the BTC price surge after the halving - $50,000, instead of $100,000 which is used here by many. He used monthly BTC market data in the formula.
However, the expert points out that whether one chooses a conservative model ($50,000) or an aggressive one ($100,000) is a matter of taste.
Good eye. Yes I used the original formula btc=0.4*sf^3 fitted on monthly data, with lower 2020-halving prediction ($50k). My personal favorite formula is btc=0.18*sf^3.3 fitted on yearly Oct data, with higher prediction ($100k). A matter of taste IMO: conservative or aggressive.— PlanB [Jan/3➞🔑] (@100trillionUSD) January 1, 2020
Similarly to gold, Bitcoin shows a very high stock-to-flow ratio thanks to the low issuance compared to the currency circulating supply. As time passes, the stock-to-flow ratio of BTC is expected to exceed that of gold, since the block rewards are going to decrease with each halving that remains.
This decade will bring half of the world to Bitcoin: Willy Woo
The cryptocurrency analyst Willy Woo has summarized the previous decade, saying that one percent of the world started using or/and investing in Bitcoin. The coming decade, he hopes, will ‘convert’ half of the world into the ‘Bitcoin faith’.
Data points: @mrauchs did the most in-depth adoption study with 35m user accounts on Coinbase which is the lower bound. That was a year ago, BTC adoption does a 2x per year as a baseline. 4x in bull markets. I did a study showing 2x growth per year also using Google Analytics.— Willy Woo (@woonomic) January 2, 2020
‘Bitcoin and Ethereum are best investments’
The crypto trader ‘Bitcoin Macro’ reckons that Bitcoin and Ethereum are the best crypto assets one can invest in. He calls Bitcoin the mothership of crypto and compares Ethereum with an ‘index fund for altcoins’.
His portfolio, the expert says, usually totals Bitcoin/Ethereum on a 50/50 ratio.
Bitcoin and Ethereum.— Bitcoin Macro (@BTC_Macro) January 1, 2020
The perfect combination for your average crypto investor.
Bitcoin is the mothership. And Ethereum acts like an index fund for Altcoins.
The majority of my own portfolio is in $BTC and $ETH.
Keep it simple. Less is more, especially in crypto!