One of the largest banks in Germany, Bayerische Landesbank (BayernLB) published a study in which it predicted the price of bitcoin in 2020 based on the ratio of reserves and growth and models of Seyfedin Ammus and the popular analyst Plan B.
Is Bitcoin outshining gold? @saifedean introduced the stock-to-flow approach to Bitcoin. It serves to quantify the “hardness” of an asset. We took the quantitative model of @ 100trillionUSD (using Bitcoin's stock-to-flow ratios to explain its market value) for a spin ours elves.?
– BayernLB (@BayernLB) October 1, 2019
A #BayernLB Thread #Research
Read more here: https://t.co/PGscyM5eff or in german https://t.co/8KMVaV6MR7– BayernLB (@BayernLB) October 1, 2019
BayernLB considers the model quite convincing in terms of econometrics and heuristics. The bank is convinced that bitcoin is very similar to gold in the context of hardness, and after halving in 2020, the asset will demonstrate an identical ratio of reserves and growth.
In May of next year, the block reward will drop to 6.25 BTC, which BayernLB called a brilliant approach.
One of our key insights: Whereas gold has had to earn its high stock-to-flow ratio “the hard way“ over the course of millennia, Bitcoin's purely digital character enables “supply engineering,” which causes the stock-to-flow ratio to rise at a breakneck pace.
– BayernLB (@BayernLB) October 1, 2019
Having warned that the forecasts may turn out to be inaccurate, analysts called the $ 90,000 mark a target after the halving.
Read more about how bitcoin exceeded the monetary properties of gold at the link.
Bitcoin standard: how the first cryptocurrency surpassed gold
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