Crypto Analyst : Bitcoin Risk is 'Overestimated,' Price Could 'Overshoot' $100,000

Crypto Analyst : Bitcoin Risk is 'Overestimated,' Price Could 'Overshoot' $100,000

  • Crypto analyst PlanB says bitcoin's risk is being overestimated.
  • Historical trends point to bitcoin overshooting the price predicted by stock-to-flow model.

Popular crypto analyst PlanB says bitcoin’s risk is overestimated while the state of the current financial system is being overlooked. 

According to a series of tweets published at the end of last month, PlanB said bitcoin’s risk was being incorrectly magnified while investors ignore the looming collapse of the global markets. 

IMO #bitcoin risk is OVERestimated, and risk of current financial system collapsing is UNDERestimated— PlanB (@100trillionUSD) January 24, 2020

The analyst also linked to a Medium post published in January, which applies stock-to-flow (S2F) to bitcoin’s price. PlanB found that bitcoin markets tend to overestimate risk relative to the amount of return generated and that S2F models are better indicators for price prediction. 

He wrote, 

Historical risk & return data of bonds, gold, stocks and bitcoin, shows that bitcoin markets overestimated risk. Bitcoin return was not in line with risk, but very much in line with S2F model.

PlanB also offered an addendum to his model’s prediction that bitcoin’s price could reach $100K by 2024. Replying to a tweet, the analyst agreed that BTC tends to overshoot model predictions following a halving event, which could take the price as high $1 million.

Correct, historical overshoots were 3-10x .. so $300k-1m ath would not be very strange. The overshoot could also be smaller this time of course, e.g. 2x— PlanB (@100trillionUSD) January 17, 2020

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