In the crypto community, an infamous bullish model on Bitcoin has buzzed, predicting a substantial appreciation in BTC/USD after the next halving, expected in May this year. This model is referred to as the Stock to Flow (SF or S2F) model, quantifying the relationship between the market value of Bitcoin and its scarcity. We explain why we think that from a statistical vantage point, the results of this model are misleading. We propose a new model, aiming at capturing both short-term and long-term dynamics of the relationship between the market value of Bitcoin and the stock-to-flow ratio. Our new model cannot assert the presence of significant short-term and long-term dynamics of the relationship between the market value of Bitcoin and the stock-to-flow ratio.
