Vitalik Buterin calls Bitcoin stock‑to‑flow model harmful after price

Vitalik Buterin, Ethereum co‑founder, labeled the Bitcoin stock‑to‑flow (S2F) model “false” and “harmful” on June 21, 2022, after Bitcoin traded around $20,845—well under the S2F forecast of $67,175 for mid‑June and far from the model’s 2022 $100‑110 k range [1][3].

Why the criticism matters

Buterin’s tweet echoed EthHub co‑founder Anthony Sassano, who called the S2F model “an epic failure.” The model, created by analyst PlanB, links Bitcoin’s circulating supply (“stock”) to the annual mining rate (“flow”) and has historically suggested that scarcity drives price up. Its 2022 projection of $100‑110 k has been invalidated by the market’s 18‑month low under $20 k [1]. PlanB himself admitted the model “enjoyed a good run” until March 2022 before deviating from its trajectory [1].

Market context and on‑chain backdrop

Bitcoin’s price drop to $20,845 occurred amid a broader crypto market slump, with the asset losing roughly 80 % of its 2021 peak. The S2F ratio, which rose sharply after each halving, has not translated into price gains this cycle, prompting analysts to question its predictive power. No new supply unlocks or major on‑chain events were cited as drivers of the price move; the primary narrative is the mismatch between the model’s expectations and actual market behavior [1][3].

Reactions from the model’s author

PlanB responded to Buterin’s critique by suggesting that the market’s downturn could lead some investors to seek “scapegoats” for poor outcomes, while also noting that Bitcoin might be “extremely undervalued” and could rebound, or that S2F may simply lose relevance [1].

What to watch

• Price level: $25,000 – a psychological resistance that could test the model’s credibility if breached.
• On‑chain metric: Changes in the stock‑to‑flow ratio after the next halving (expected in 2024) may reignite debate over the model’s validity.
• Regulatory signal: Any U.S. ETF approval for Bitcoin could provide fresh demand, potentially narrowing the gap between S2F forecasts and market price.

Buterin’s dismissal underscores a growing skepticism toward deterministic price models in crypto, especially as Bitcoin’s actual price diverges sharply from S2F projections. Whether the model will adapt or fade remains an open question for analysts and investors alike.