# Bitwise analyst warns Bitcoin stock‑to‑flow model may be unreliable

**Published:** 2026-08-01T08:08:20.666Z  
**Topic:** Stock To Flow  
**Sentiment:** neutral  
**Publisher:** TrendWatcher — https://www.trendwatcher.in/article/f4abe661-f231-4ea8-bd58-892c4332813e

Bitwise’s André Dragosch says the Bitcoin S2F forecast of $222,000 ignores demand factors, with institutional buying now over seven times the halving supply

Bitcoin’s widely‑cited stock‑to‑flow (S2F) model still projects a $222,000 peak for this cycle, but Bitwise analyst André Dragosch cautioned that the model’s focus on supply‑side halvings ignores demand‑side forces that now dominate the market [2].

| At a glance | |
|---|---|
| S2F price target | $222,000 |
| Institutional demand vs. supply reduction | > 7 × |
| Current price floor | > $100,000 |
| Key catalyst | Surge in Bitcoin ETFs and treasury holdings |

## Model focus versus market reality  
The S2F framework, created by PlanB in 2019, links Bitcoin’s price to its scarcity ratio—stock (existing supply) divided by flow (annual new supply) [3]. Dragosch notes that while the model predicts a $222,000 price by the end of the current cycle, it “fails to consider demand‑side factors” [2]. Institutional demand, measured through Bitcoin exchange‑traded products (ETPs) and treasury holdings, now exceeds the annualised supply reduction from the latest halving by more than sevenfold [2]. This demand has helped keep Bitcoin above the $100,000 level, establishing a price floor that the S2F model does not account for [2].

## Competing forecasts and criticism  
Other valuation frameworks offer lower, yet still bullish, estimates. The BAERM (Halving Supply Shock) model places Bitcoin’s fair value near $159,000 and projects $173,000 by the end of 2025 [3]. The Power Law model, which ties price to a time‑based formula, forecasts a 10‑year price of $2.03 million—substantially below the S2F peak but above the BAERM level [3]. Dragosch highlights statistical flaws in the S2F approach, including omitted variables and a negative drift in residuals, suggesting the model may be “misspecified” for today’s demand‑driven market [3].

## Institutional flows as a new price driver  
ETF inflows and treasury purchases have become a primary source of price support. Data shows sustained institutional interest, with Bitcoin ETPs absorbing supply at rates far exceeding the halving‑driven flow [2]. This shift implies that future price movements may be more closely tied to the pace of institutional adoption than to the timing of halvings alone.

## What to watch
- **$200,000 resistance** – a level cited by Standard Chartered’s Geoff Kendrick as a possible 2025 target; a break could test the S2F forecast.  
- **ETF inflow reports** – monthly net inflows into Bitcoin ETPs; a sharp rise or drop may signal demand shifts.  
- **Upcoming halving schedule** – the next halving is expected in 2024; monitoring whether institutional demand continues to outpace the reduced supply will be key.

Dragosch’s warning underscores a broader debate: as Bitcoin’s market matures, traditional scarcity‑based models may need to incorporate demand dynamics to remain useful. Whether the S2F model can adapt or be supplanted by demand‑focused frameworks remains an open question for investors and analysts alike.

## Sources
1. Chaincatcher — [Bitwise Analyst: Bitcoin Can Hedge Against...｜BTC... - ChainCatcher](https://www.chaincatcher.com/en/article/2202150)
2. Bitbo — [Bitwise Analyst Warns on BTC Stock-to-Flow Model Reliability](https://bitbo.io/news/bitcoin-stock-to-flow-warning/)
3. BeInCrypto — [Are Bitcoin Price Models Still a Reliable Guide for Investors in 2025?](https://beincrypto.com/bitcoin-price-models-institutional-demand/)
4. Binance — [Bitwise Analyst: Bitcoin Can... | Binance News on Binance Square](https://www.binance.com/en/square/post/08-31-2025-bitwise-29051403216554)

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Cite as: TrendWatcher, "Bitwise analyst warns Bitcoin stock‑to‑flow model may be unreliable", https://www.trendwatcher.in/article/f4abe661-f231-4ea8-bd58-892c4332813e