PlanB is a pseudonym to refer to an unknown Dutch investor who has contributed to the crypto industry by setting up the Bitcoin Stock-to-flow model. It has emerged to be the most viable method of price prediction for Bitcoin.
Even though there is not much information available about this crypto scientist, his contributions to the field remain relevant at all times. Plan B has been active in the industry since 2019 and has since then published many papers on the Bitcoin Stock-to-flow model.
In this article, you will read in detail about Plan B and his contributions to the crypto industry.
Who Is PlanB?
Even though PlanB is the pseudonym and the real identity of the person is still unknown, this crypto scientist has a good number of followers on the X platform. PlanB is a former institutional investor hailing from the Netherlands. His educational background is in law and quantitive finance. It was after several years of focus and experience in the crypto industry that he formulated the Bitcoin Stock-to-flow model that predicts the Bitcoin price based on the scarcity of the coin.
PlanB’s Stock-to-flow model is considered the most accurate method of predicting the Bitcoin price to date. The model has also been accurate in predicting the exact timing of the Bitcoin halving events. The price of the coins at the time and after each Bitcoin halving event has been exactly predicted by PlanB.
As the real identity of PlanB is unknown, his real net worth is also unknown. However, it is estimated that he is worth millions of dollars. A major chunk of his net worth comes from his investments in Bitcoin and other types of cryptocurrencies. He has also earned high from consulting on cryptocurrency investments and his research based on the Bitcoin Stock-to-flow model.
PlanB’s Stock-To-Flow Model
The Bitcoin Stock-to-flow model, invented by PlanB uses the principle of scarcity of Bitcoins to predict its price. The model is simple to understand and shows accurate results. Through the Stock-to-flow model, PlanB attempts to predict the price of Bitcoin based on the commodity’s scarcity in the market. The scarcity of a commodity that has high demand will result in it having high prices.
In the Stock-to-flow model, the scarcity of an asset is determined by dividing its total supply (Stock) by its annual production (flow). Plan B was successful in predicting the price of Bitcoin using the Stock-to-flow model as Bitcoin had a fixed total supply and its annual production was also low, making it a scarce asset.
PlanB’s Bitcoin Stock-to-flow model became popular after the third Bitcoin halving event in 2020. On calculations, the stock-to-flow ratio of Bitcoin in August 2020 was 63. After 2022, Bitcoin’s stock-to-flow ratio has overtaken that of Gold, making Bitcoin a much more profitable asset than Gold.
After each Bitcoin halving event where the incentives given are halved, the stock-to-flow ratio is rising, thus increasing its price. Bitcoin’s price will always be determined by the demand for the commodity. Since the demand will always be high due to its scarcity, PlanB’s Stock-to-flow model predicts a predominantly bullish outlook for Bitcoin at all times.
Plan B formulated Bitcoin’s stock-to-flow ratio of Bitcoin by collecting monthly data from December 2009 to February 2019. He collected this data using a unique programming language and aimed to create the monthly stock-to-flow rate of Bitcoin from December 2009 to February 2019.
However, Bitcoin’s Stock-to-flow model has also invited widespread criticism. PlanB had predicted that the Bitcoin price would hit a high mark of $288,000 before the year 2024, i.e., before the fourth Bitcoin halving event. Many analysts such as Alex Kruger have dismissed PalnB’s stock-to-flow model as non-sensical.
The Bottom Line
PlanB, who claims to be a Dutch Institutional investor in crypto, has been a seminal presence in creating a crypto price prediction model called the stock-to-flow model. Even though the model has faced some criticisms from certain analysts, its success as a model for accurate price predictions is indisputable.
PlanB has thus become a name synonymous with Bitcoin price prediction and the Stock-to-flow model’s success has been leveraged in predicting the price of other valuable commodities such as gold.
