Bitcoin’s Potential Rally: Is the Stock-to-Flow Model Still Valid?
Bitcoin could be on track for a significant long-term rally if the Stock-to-Flow (S2F) model remains a valid indicator. According to pseudonymous analyst PlanB, the S2F model suggests Bitcoin could average around $500,000 during the current halving cycle, spanning from 2024 to 2028. This projection arrives as Bitcoin recently reclaimed the $70,000 price level after a period of volatility.
Understanding PlanB’s $500,000 Projection
PlanB’s projection isn’t a prediction of an immediate price surge to $500,000. Instead, it forecasts an average price of $500,000 throughout the entire post-halving cycle (2024-2028). Achieving this average would necessitate Bitcoin spending a considerable amount of time trading well above that price point at some stage within the cycle. The current market conditions are essentially testing whether Bitcoin is currently undervalued or if the S2F model has lost its predictive power.
The Stock-to-Flow Model Explained
The Stock-to-Flow (S2F) model, created by PlanB, predicts Bitcoin’s price based on its scarcity. It calculates the ratio of existing supply (stock) to the annual new production (flow) Bitcoin Stock-to-Flow Model. As Bitcoin undergoes halvings approximately every four years, the flow decreases by 50%, dramatically increasing the S2F ratio. The model uses the formula: Price = 0.18 × (S/F)^3.3, which has historically shown a 95% correlation with Bitcoin’s price movements Bitcoin Stock-to-Flow Model.
The model’s chart overlays Bitcoin’s price history with the 200-week moving average, realized cost price, Relative Strength Index (RSI), and a staircase-like S2F path. The dotted S2F path for the 2024-2028 halving window rises to approximately $500,000 in 2027 Bitcoin Stock-to-Flow Model.
Recent Bitcoin Price Action
Bitcoin has experienced a volatile week, trading above $73,000 on March 5 before falling towards the mid-$60,000s and subsequently rebounding above $70,000. This uncertain price action underscores the significance of PlanB’s S2F prediction, as it requires strong conviction to forecast an average price of $500,000 for Bitcoin.
Currently, Bitcoin is trading slightly above two key structural supports: the realized cost price and the 200-week moving average. While this doesn’t guarantee a significant breakout, it suggests the overall cycle structure hasn’t entirely collapsed.
Current Market Sentiment
Approximately 43% of Bitcoin addresses are currently holding at a loss, with the majority being short-term holders and Bitcoin treasury firms. Despite this, some analysts believe Bitcoin’s correction hasn’t yet reached its bottom, even though it has fallen by over 45% from its peak in October 2025.
What is Stock-to-Flow?
The ‘Stock-to-Flow’ is a number that shows how many years, at the current production rate, are required to achieve the current stock. The higher the number, the higher the expected price Bitcoin Stock to Flow Model – S2F Live Chart (PlanB). The Stock-to-Flow (S2F) model treats Bitcoin as comparable to commodities and precious metals such as gold, silver, or platinum, which are considered ‘store of value’ commodities due to their scarcity Stock-to-Flow Model | BM Pro.