New Bitcoin Stock-to-Flow Chart Shows Bearish Periods Precede Halvings

Since Bitcoin’s (BTC) creation in 2009, the digital asset has undergone a halving event every four years, cutting the number of coins constantly entering the ecosystem in half, making it a deflationary asset. 

Based on its hard-coded scarcity, and in line with its halvings, Bitcoin has risen dramatically in price over the years, giving the asset a high stock-to-flow ratio. When graphically depicted with deviation bands, Bitcoin historically has tested band levels below its median prior to halving years.

Crypto analyst PlanB wrote an article in March 2019, applying Bitcoin to the stock-to-flow model used in the traditional business world, previously applied to commodities such as gold and silver. 

Using gold as an example, the stock-to-flow model addresses the metal’s scarcity as it lines up with its supply and the amount of new gold made available each year, the article noted. 

PlanB used this information to plot a Bitcoin chart depicting its stock-to-flow ratio and making a…