| Power law | Stock-to-flow | |
|---|---|---|
| Input | Time since the genesis block | Scarcity: existing supply divided by yearly new supply |
| Shape | Straight line on a log-log chart | Price rises in steps with each halving |
| Halvings | Not part of the model | The central driver |
| Claim | Describes a long-term growth corridor | Links price directly to scarcity |
| After 2021 | Price returned to the corridor's lower half | Price stayed far below the model values for years |
Different inputs
The power law needs only one number: the age of the network in days. Stock-to-flow, popularised in 2019, uses the ratio of the existing Bitcoin supply to the new supply mined each year. Because that ratio jumps at every halving, stock-to-flow predicts a step change in price after each one.
How they held up
After the 2021 cycle high, Bitcoin traded for years well below the stock-to-flow values, and many analysts stopped using the model. The power law corridor is wider by construction and the price moved back into its lower half, with brief breaches of the floor. A wider corridor is easier to stay inside; that is a strength for orientation and a weakness for precise statements.
What neither model can do
Both are statistical fits to the past. Neither contains demand, regulation, competition or the behaviour of large holders. Use them for scale — what order of magnitude is consistent with the past — not to time a purchase.
More guides
- Bitcoin Power Law Calculator: 6 Tools Explained
- How Much Bitcoin Do I Need to Retire? Power Law Calculator
- Bitcoin Power Law Formula Explained (a, b, R²)
- Bitcoin Power Law Floor Price by Year (2026–2040)
- Bitcoin Price Prediction 2030: Power Law Model Values
- Bitcoin Price Prediction 2035: Power Law Model Values
- Bitcoin Price Prediction 2040: Power Law Model Values
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