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Bitcoin would be worth USD 72,000 right now if the financial crisis hadn’t occurred

Bitcoin
Bitcoin

Every day numerous predictions of the price of bitcoin (BTC), the main cryptocurrency in the market, are published around the world. Some manage to hit and others are very far from the real number. They have even erred metrics and analysts who on other occasions have managed to hit the nail on the head.  This is the case, for example, with the tool known as « S2F or stock-to-flow «. This predicts the price of bitcoin by dividing the total amount of issuance that the cryptocurrency will have by the annual production.

Although this metric has managed to predict moments like the correction from May to July 2021, it suggests that bitcoin will reach $72,000 this week. Such a projection is unlikely to come true in the current context, not to say “impossible”. That’s why recently the co-founder of Ethereum has criticized, he has criticized stock-to-flow . Cryptocurrency is down, as the stock market, as inflation and measures to counter its rise in the United States and Europe. For six days, BTC has traded between USD 20,000 and USD 22,000, so specialists are closely watching whether it will break down or up these days.

From Fidelity, they pointed out that SF2 is no longer accurate and never will be. The reason they defend is that it is almost impossible to accurately calculate the future adoption rate of bitcoin. The current drop is one of the largest the market has seen in its history and was not anticipated by many metrics or specialists.  Contrary to the downward trend that the market is going through, different analysts predicted that the main cryptocurrency would reach a new all-time high at this time. Even specialists who on different occasions have managed to closely target their price in advance.

An example of this is Carlos Maslatón, who a year ago said that now, in June 2022, bitcoin would be worth more than USD 120,000. However, it is worth clarifying that at other times he has been right in his predictions which has allowed him to get rich as an investor. He claims that his successes have been due to his analysis of the human behavior of traders.

A single statistic or individual should not be used to predict the price of Bitcoin

From this panorama, it remains as a lesson that the price of bitcoin depends on a confluence of factors. Therefore, your prediction cannot be made based on a single metric or an analyst’s view. This can be seen today, where despite the growing institutional adoption and interest in BTC, its price has been in free fall. Mainly due to the economic-political context and the fear that some events generated, as economist Jose Sarasola explained to CriptoNoticias.

In this sense, it is essential to understand that the price of BTC cannot be predicted by analyzing a single factor. To predict its movement, it is convenient to appropriate different prediction metrics, as well as analyze the behavior of bitcoin investors in the context.  The better idea you can have of the reality that impacts the bitcoin market, the more it will be possible to correctly predict its price movements. Although, even so, nobody has the crystal ball to predict the future. Therefore, as in any investment, it is crucial to consider the possible risk to be prepared for different scenarios.

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Written by Rachita Salian

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