The founder of Etherium disagrees with Bitcoin’s Stock-to-Flow model

In his latest Twitter post, Ethereum co-founder Vitalik Buterin says he disagrees with the famous Bitcoin stock-to-flow (S2F) model, which was first published by the pseudonym Dutch analyst PlanB in March 2019. .

With this in mind, he admits that the fact that there is no consistent correlation between price spikes and four-year reductions in Bitcoin awards is not sufficient to refute the model.

The discrepancy raises doubts


As reported, the 50 percent reduction in the Bitcoin Block Miners’ Award to 6.25 BTC on May 11 generated record search interest.

It is generally believed that this event led to a significant rise in prices. From July 2016 to May 2019, BTC increased by 1,250%. Earlier, the asset jumped nearly 7,000 percent in the first four-year cycle, which began in November 2012.


However, the mismatch between the rise in Bitcoin prices makes the popular theory ” unsolvable, ” according to Buterin.

This essentially means that time makes it difficult to prove or disprove. For example, the flagship cryptocurrency reached its current highest price of $ 20,000 in the middle between 2016 and 2020.

S2F has many critics


Bitcoin’s S2F model predicts that the price should rise significantly after each halving event because the asset becomes increasingly scarce.

In fact, Bitcoin’s annual inflation is now below that of gold.

However, outside of the echo chamber of Bitcoin bulls, the model has been met with much skepticism. Many question its viability because it fails to include demand itself in the calculations.