The start of the bull market was announced by PlanB, a quantitative analyst famous, for creating the stock to flow (S2F) model used to forecast Bitcoins price trends. According to PlanB, the phase of accumulating Bitcoin has ended, signaling a shift away from easy buying opportunities for the currency.
This statement was shared on X along with reference to the S2F chart indicating the beginning of a market cycle characterized by 10 months of intense fear of missing out (FOMO) involving significant price spikes and occasional drops of around 30%.
This forecast came shortly after Bitcoin crossed the $60,000 milestone for the time in than two years but saw a slight dip of 0.75% within 24 hours stabilizing at $62,472 by 3;00 pm Central European Time. Despite gaining prominence during the 2021 bull run doubts have been raised about the S2F models accuracy as a predictor of Bitcoins price movements.
The model had predicted that Bitcoin would surpass $100,000 by August 2021; however this target was missed as Bitcoin was trading, around $44,000 at that time.
Ethereum co founder Vitalik Buterin has also shared doubts, about the S2F model pointing out that it may give investors a sense of security.
In line with PlanBs perspective Vetle Lunde, an analyst at K33 Research mentioned that Bitcoin usually goes through a period of consolidation after halving but tends to see an upswing in the months. Lunde emphasized that the time frame from 150 to 400 days post halving presents opportunities for entering the market as reduced selling pressure from miners can positively impact Bitcoins price trajectory.
Apart from the excitement surrounding the Bitcoin halving event other factors like the approval of spot Bitcoin exchange traded funds (ETFs) have also been instrumental in driving investor interest and price increases.
Notably when the Grayscale Bitcoin Trust ETF sold $598.9 million worth of BTC on February 29 there was a 3% price correction. However Bitcoins price has surged by over 22% in the week according to CoinMarketCap data.
The launch of nine new spot Bitcoin ETFs with a combined volume exceeding $2 billion for two days by February 28 has significantly impacted investments, in Bitcoin.
Since they were introduced on January 11 these ETFs have been responsible, for 75% of the Bitcoin investments according to CryptoQuant, a company that specializes in analyzing on chain data.
These ETFs introduce a type of demand for Bitcoin that is not tied to price paving the way, for possible record high values by the end of 2024.
