What stock-to-flow actually measures
Stock-to-flow is a ratio borrowed from the commodities world, specifically from how gold and silver analysts have valued precious metals for decades. The “stock” is the total existing supply of an asset. The “flow” is how much new supply is produced each year. Divide one by the other and you get the number of years it would take, at current production, to double the supply. Gold has a stock-to-flow of about 62 — it would take 62 years of mining to double the above-ground gold supply. Silver is around 22. Copper is 0.4. Bitcoin, after the 2024 halving, is roughly 120.
The intuition is simple. High stock-to-flow signals scarcity because even an aggressive supply response can barely dilute the existing stock. Low stock-to-flow means any demand surge can be absorbed by increased production. This is why copper acts like an industrial commodity (tracks demand) while gold acts like a monetary commodity (tracks confidence). Bitcoin is the first digital asset designed from inception to have monetary-commodity stock-to-flow properties — and after each halving, its flow drops by 50% while stock keeps growing.
PlanB’s original S2F formula and why it went viral
In March 2019, an anonymous Dutch investor publishing as PlanB released a paper titled “Modeling Bitcoin Value with Scarcity.” He regressed Bitcoin’s historical price against its stock-to-flow ratio on a log-log scale and found an R² of 0.947. The resulting formula was: Model Price = 10^(0.4 + 3.3 × log₁₀(S2F)). The 0.4 is the intercept. The 3.3 is the exponent — meaning every doubling of stock-to-flow historically produced a roughly 10× increase in price.
The model produced startling predictions. At a post-2020-halving S2F of ~56, it targeted a Bitcoin price of ~$100,000. At the 2024 halving’s S2F of ~120, the model pointed at ~$500,000. It got much of 2020-2021 approximately right — Bitcoin hit $69,000 during a model prediction window of $55-100k — and then spectacularly missed the 2022 bear market, which deviated far below the model line. PlanB has since released refinements (S2FX, a cross-asset version), but the original formula remains the most-cited scarcity model in crypto.
Five ways to read the current reading
Within ±30% of model: Historically normal. The model is directionally useful, not precise, and prices move in a wide band around the line. Don’t overreact.
50-100% above model: This is late-cycle territory. The 2017 peak was ~60% above model. The 2021 peak was ~30% above. Not every deviation is a top, but every top has been a deviation.
Over 100% above model: Historically rare and short-lived. Occurred briefly in 2013 and 2017. Tends to be followed by drawdowns of 70%+ within 12 months.
30-60% below model: Historically, this band coincides with accumulation phases. Most of 2019 and 2022-2023 sat in this zone.
Over 60% below model: Capitulation — the 2018 bear market bottom and briefly during the March 2020 COVID crash. These windows lasted weeks at most.
The critiques that have dented S2F’s reputation
The model has real flaws. First, it treats a single variable (scarcity) as if it explains everything, which ignores demand, macro conditions, and reflexivity. Ethereum had much lower stock-to-flow than Bitcoin through 2021 but delivered comparable returns — demand dynamics clearly matter. Second, the R² was computed on a tiny dataset (essentially two completed halving cycles at the time), so statistical significance is thin. Third, the model failed catastrophically during 2022, dropping to ~70% below the projection and staying there for over a year. PlanB’s “worst case $100k by end of 2021” prediction did not age well.
The defense, in short: all models are wrong, some are useful. S2F was never meant as a precision timing tool. It’s a lens — a way to think about long-run scarcity driving long-run valuation. Used as a sanity check (“am I buying near model, above model, or way below?”), it still provides signal. Used as a day-trading tool, it’s noise.
How to actually use this calculator
Start with the defaults — they match Bitcoin’s current supply and annual issuance post-2024 halving, and PlanB’s original coefficients. The model price that drops out is your baseline. Compare that number to the live spot price. A premium of +30% to +60% during a bull run? Totally normal — don’t sell your stack based on S2F alone. A premium of +150%? Historically, this has been a zone to take meaningful profit and wait.
Now try changing the coefficients. Recent academic work suggests an exponent closer to 2.5 may fit the full dataset better than 3.3 once you include 2022-2023. Set the exponent to 2.5 — the model price drops considerably, meaning prior “undervalued” readings may have been closer to fair. This is how you stress-test a model: assume you had the formula slightly wrong and see how much it mattered.
Related calculators
- Bitcoin halving countdown — days until the next halving and its supply impact.
- Bitcoin cycle top predictor — a complementary MVRV-based cycle valuation model.
- BTC vs S&P 500 — compare Bitcoin’s performance against traditional benchmarks.
- Future value crypto calculator — project portfolio value under different CAGR assumptions.