Stock-to-Flow was the dominant Bitcoin valuation model from 2019 to 2021. It correlated scarcity with price across three halving cycles. Since late 2021, price has consistently trailed the model. The framework still has something to say about why Bitcoin gets a monetary premium. It is not a price oracle. Here is the honest review.
READING TIME: 7 MIN
Not financial advice. Valuation models are tools for thinking, not forecasts. Figures marked [VERIFY] change and should be confirmed before you rely on them.
Stock-to-Flow divides the existing supply of an asset by its annual new production. High ratio = scarce. Gold is ~60. Bitcoin's ratio doubles at every halving and now sits around 120 [VERIFY]. Plan B's 2019 model plotted Bitcoin's price against this ratio and predicted $100K+ by late 2021. It was directionally right for a decade and specifically wrong since 2022. The critique is sound: scarcity is deterministic; price is not. Use S2F to understand scarcity, not to time price.
Stock-to-Flow is the ratio of existing supply (stock) to annual new production (flow). Gold's S2F sits around 60, meaning it would take roughly 60 years of mining at current rates to double the existing above-ground supply. Silver sits near 22. Platinum and palladium are far lower. High S2F has historically been a marker of monetary-grade scarcity.
Bitcoin's S2F doubles at each halving. After the 2012 halving it was ~8. After 2016, ~16. After 2020, ~55. After the 2024 halving, Bitcoin's S2F sits around 120 [VERIFY]. By the math, post-2028 halving it will sit around 240, well above gold.
Bitcoin is the only asset in history whose Stock-to-Flow is known with certainty decades in advance. The supply schedule is enforced by code. No central bank can print more. No mine can be discovered.
Plan B, a pseudonymous Dutch institutional investor, published "Modeling Bitcoin Value with Scarcity" in March 2019. The approach: plot gold and silver as two data points on a chart of S2F vs. market cap, fit a power-law regression, then plot Bitcoin on the same line.
The model predicted Bitcoin would reach roughly $55K after the May 2020 halving and $100K+ by late 2021 or mid-2022. At publication, Bitcoin was trading near $4,000. The prediction looked absurd to most readers.
Bitcoin hit $69K in November 2021. The first prediction window came close to being met. For a two-year forecast starting from $4K, this was remarkable.
Across three full halving cycles, Bitcoin's price tracked the S2F trajectory with striking fidelity. The correlation was the most compelling quantitative case any Bitcoin model had produced, and it drove significant institutional attention. Paul Tudor Jones cited scarcity dynamics in his 2020 thesis. MicroStrategy's first buys came within months of the model's validation. A generation of allocators used S2F as the shorthand case for Bitcoin.
The bull case was simple: supply is mechanically halved every four years; demand has grown; price rises to meet the new ratio. Three cycles in a row, that is what happened.
The model predicted a significant further breakout after the 2024 halving. Specific predictions from the original and cross-asset variants pointed at roughly $288K by late 2024 [VERIFY Plan B model], with some extrapolations going higher. Actual peak in late 2024 and early 2025 was roughly $108K, and the cycle has since spent time well below that.
The 2022 bear market also broke the model's trajectory. Bitcoin fell to $16K when the model suggested a floor well above that. Macro conditions (the 2022 rate hiking cycle, FTX implosion, Luna collapse) drove price far below the scarcity-implied value.
The model explains long-term drift. It does not explain cyclical volatility, macro regime changes, or sentiment cycles. Anyone using S2F to time entries and exits in 2022 to 2025 has been wrong repeatedly.
Nic Carter and others have made the sharpest version of the critique: S2F is partly tautological. Every halving mechanically reduces flow and mechanically raises S2F, whether or not demand keeps up. Correlation between a deterministic variable and historical price does not prove causation. It may prove that past cycles coincided with macro conditions that favored risk assets. Future cycles may not.
A second critique: the model has only three full-cycle data points. Power-law fits on three data points are statistically fragile. The r-squared looks impressive until you realize how few independent observations support it.
Scarcity matters. Hard-capped supply is unusual, and it is part of why Bitcoin accrues a monetary premium at all. The directional point (scarcer assets tend to appreciate relative to infinite-supply assets) is real and defensible. A gold-standard currency historically outperformed paper currencies in long-duration store-of-value terms.
S2F also pointed at a real mechanism: each halving shifts the miner economics, and miners selling pressure on the spot market is a significant variable. Lower flow means lower sustained selling pressure from the marginal producer.
Treat S2F as one framework among several, not a price target. It tells you scarcity is increasing mechanically each halving. It does not tell you what demand will do. Combine it with network-value metrics, monetary-premium analysis, and macro context.
Plan B has periodically revised the model and walked back specific price predictions. The "v2" and the cross-asset variants have also diverged from actual price since 2022. Treat the family of models as illustrative, not predictive [VERIFY current Plan B position as of 2026].
The broader lesson: even a model that was famous enough to move markets failed to predict the next cycle accurately. Anyone promising a specific Bitcoin price for a specific date is selling conviction, not analysis.
Last updated 2026-04-14. Not financial advice.