Bitcoin’s price has fallen nearly 20% in the past week, but in PlanB’s worst-case scenario, the cryptocurrency would still hit $ 135,000 by the end of this year
Last week was not a good time for Bitcoin. Chinese authorities continued crackdown on Bitcoin mining when they extended the ban to Sichuan Province, which controls 10% of the Chinese hash rate and 6% of the global hash rate.
This could have been a factor in Bitcoin price falling below $ 33,500 yesterday, after falling nearly 20% since its high on Tuesday.
And many investors fear that further losses could be imminent as the Bitcoin price chart formed a death cross over the weekend. This is when the 50-day moving average falls below the 200-day moving average and is usually taken as an indication that a price is about to crash.
The bitcoin modeler and on-chain analyst PlanB pointed out on Saturday that this can sometimes be a contrary signal. In fact, the last two death crosses for Bitcoin resulted in a price spike in the fourth quarter of 2019 and the first quarter of 2020.
PlanB developed the Bitcoin Stock To Flow (S2F) model, which uses scarcity to quantify Bitcoin value. Its broad correlation with Bitcoin’s price action means that many investors trust the model to provide long-term forecasts. S2F predicts Bitcoin worth $ 100,000 by the end of 2021 and $ 1 million in 2025.
So is the analyst recommended over the weekend that Bitcoin distribution is now much healthier than it was in late April, showing that 60% of coins sold in May and June were bought and sold at a loss in March and April.
PlanB admits that Bitcoin price weakness is possible until July, its Predictions for the rest of the year are more bullish. PlanB’s worst-case scenario for August is a price of $ 47,000 per bitcoin, followed by a minimum of $ 63,000 in October and a minimum of $ 135,000 in December.
He also indicated that its best-case scenario is that Bitcoin will be worth $ 450,000 by the end of the year.
At the moment, however, the Bitcoin price is still falling. It is down 6% today and is currently trading at $ 32,900 at the time of writing.