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Bitcoin is on it re-examination method the $69,000 price level again in the early hours of Monday, October 28, as the bulls look to start the week on a positive note. A significant break above $69,000 will set the stage for a further rally in the coming months.
Speaking about the ongoing meetingThe Bitcoin Stock-to-Flow model points to an interesting trend in the long-term outlook for Bitcoin. In particular, crypto analyst Plan B made a reference to the Stock-to-Flow model to suggest that BTC is ready for the next phase reversal.
BTC Is Ready For The Next Phase Of Evolution
The Bitcoin Stock-to-Flow (S2F) model is attracting attention as it indicates that Bitcoin may be preparing for a new phase transition that will firm its price above $100,000. The S2F model, originally developed for use with gold and silver, measures the existing supply of the commodity against the rate of new units entering the market. In the case of BTC, the S2F model calculates the shortfall by considering its fixed supply of 21 million BTC, and the reduction of the block reward that reduces the new supply every four years.
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Each halving event lowers the output level, creating an increasing scarcity model that goes hand in hand with price growth. According to the S2F chart shared by Plan Bthis devaluation has led to a price increase in the following months, the S2F model accurately predicts the volatility of Bitcoin at the new price levels.
Bitcoin halved in April 2024, resulting in a reduction in the block reward from 6.25 BTC to 3.125 BTC. According to the S2F chart, Bitcoin’s previous decline has been the start of a price reversal into a new phase. The 2020 halving, for example, triggered a transition to a new level above $10,000 that culminated in BTC reaching a previous high of $66,000.
Now that the April 2024 halving is six months away, the effects of the slowdown are starting to be felt in Bitcoin supply and demand. So, Bitcoin is looking phase change priority over $100,000.
What Does This Mean for Bitcoin Price?
As the previous phase changes have played out, a phase change above $100,000 will strengthen the price of Bitcoin above this level. With the $100,000 price level now serving as a price floor, this will give the Bitcoin price support to continue growing in the coming months.
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Previous phase reversals have been leading to new highs before further declines. The maximum expected value in this category is less than $1,000,000. If the trends of the past hold true, the price of Bitcoin can reach this incredible event before the next decrease, which is expected to happen in 2028.
At the time of writing, Bitcoin is trading at $68,340.
The featured image was created with Dall.E, a chart from Tradingview.com