The price of BTC fell 13% last week and has triggered doubtful thoughts in the market. Willy Woo believes that soon, the first cryptocurrency would start to rebound.
The price of bitcoin (BTC) keeps falling more and more and is even threatening to break the threshold of USD 30,000. The 13% decline in the last week has spread pessimism over the community, making it clear that there is a loss of confidence in the famous Stock To Flow (S2F) model, which is a model the market analyst “Plan B” uses to project the price of the cryptocurrency.
Although the price of the first cryptocurrency has lost more than 50% of its value since it was trading in the order of USD 63,000 in April, the estimates of “Plan B” remain bullish, stating that bitcoin may close the year 2021 above 100,000 dollars.
However, the researcher’s followers on Twitter argue that their beliefs in his predictions are decaying. The analyst himself, on his account, invited his almost 600,000 followers to let him know what price they expect by the end of the year. More than 40% of the 120,000 who participated in the survey, ended up saying that the price would reach USD 100,000.
The S2F model relies on the theory that describes bitcoin as a store of value like gold or silver. Bitcoin keeps its value over the long term due to its relative scarcity. So, under this idea, Plan B correlates the stock or quantity of assets currently at hand, with the flow or bitcoins’ amount mined every year, to project where the cryptocurrency’s price would move.
Although many users believe that the price will break this year, bitcoin’s price has been meeting the parameters established in the Stock To Flow model since 2012. A projection indicates that, by the end of the year, BTC could reach USD 91,000. However, this drop represents one of the deviations of the model towards the value-rate, since 2013.
Willy Woo, and his Thoughts on What’s to Come for Bitcoin
Willy Woo is one of the analysts who show optimism about a possible short-term rally in bitcoin’s price. He even tweeted why he thinks the cryptocurrency will face a replenishment this year.
Woo believes that if at least the 4.5 million adults living in El Salvador adopt bitcoin as a legal tender, this will be an immediate boost of 2.5% of the total number of users the network currently has.
Woo thinks that bitcoin will win this battle, and while some other nations or locations believe they should eliminate the currency from the market, others are emerging to accept it to raise and protect capital.
Woo describes the impact that the industry has recently been receiving because of China’s repression against bitcoin. Meanwhile, expectations are now rising about these other nations that will follow the route of El Salvador with its Bitcoin Law.
By: Jenson Nuñez
