I don't often post on LeoFinance, because I consider myself not competent enough to. But I have had something in mind for some time now, that I reflect about, and I feel the need of writing to clarify my thoughts as well as to gather other's opinions.
You're probably already familiar with the stock-to-flow model that aims to explain and to predict Bitcoin's price evolution. I won't go into details because I don't even understand it fully, but basically it takes bitcoin halving into account, and it shows how a 4 years cycle repeats with a bull run happening after each halving.
December close: $28,992
— PlanB (@100trillionUSD) March 17, 2021
January close: $33,141
February close: $45,240
March 17 price: $55,000
We are only 3.5 months into the #bitcoin bull market. IMO BTC will not stop at $100K and will continue to S2FX $288K average price level (ATH will be higher).
However, some say this bullrun is different. Some believe it could be a supercycle. And this is where I don't understand. The people that are thinking about a supercycle are stating that this time it is different because institutions are getting in, that it is easier to understand and to buy, ..., and so that it will not repeat the 4 years pattern. But what I'm seeing here is that it just spreads at a larger scale, right?
Dan Held even wrote an article about this Bitcoin Supercycle, and he says:
However, this cycle is different.
— Dan Held Dec 24, 2020
Never before has Bitcoin had such strong fundamentals against a macro backdrop (traditional financial system) that highlights exactly why Bitcoin is needed, the narrative is singular, and the ability for global value to flow into Bitcoin has never been easier.
Maybe I'm missing something but from my understanding, this is what a mathematical function displayed on a logarithmic scale is all about. Right? It shows that each 4 years cycles are similar, but with a 10x ratio each cycle, so obviously everything has to be and to feel 10 times more impactful...
So, I might have too much confidence in maths, but I really don't have any other reason to think that the evidences behind a bitcoin supercycle are actually just what we are supposed to expect according to stock-to-flow.
What do you think? I want to hear about your thoughts and make mine evolve.