PlanB is a famous and popular BTC analysts, with over 1.7 million followers on Twitter. They are credited with inventing the stock-to-flow price model for BTC, which uses token supply to gauge value.
Their comments come as the world’s leading cryptocurrency marked a sharp fall from 2022 highs earlier this month. Bitcoin is now trading at $40k, about -20% its year’s highs, and has slumped over almost 40% from a record high hit in this November.
The token appears to have found a bottom at $40k, for now. However, BTC’s realized price- an important indicator of a worst-case scenario support level, is at around $24k.
The realized price is the average price at which most tokens in circulation were purchased. It represents the lowest possible price most market holders can tolerate while still trading in profit.
PlanB colded all fears with it’s Tweet that BTC could slump sharply to $24,000:
Some people are afraid BTC might drop to Realized Price level of $24.5K. However, last 3 times such a capitulation happened, the cause was (yellow circles):
– 2018: BSV FORK
– 2014: Bitstamp exchange HACK
– 2011: MtGox exchange HACK
Not seeing that now. pic.twitter.com/pdrkChrUOE
— PlanB (@100trillionUSD) April 15, 2022
He noted that the last times such an even occurred was in tandem with a BTC-linked “black swan” event. The analyst implied that it would take an event of extreme negative sentiment to drive a tumble to realized levels.
The last time such a capitulation occurred was in 2018, during the infamous Bitcoin Satoshi Vision (BSV) fork. The creation of the hard fork in 2018 had nearly split the BTC community in half, resulting in large price fluctuations, as well as the creation of the BSV token.
While Bitcoin appears to have established a support level at $40k, it is still trading in a limited range seen for most of the year. The broader crypto market, for most part, also appears to be following this range.
A host of macroeconomic concerns, coupled with monetary tightening by central banks have dented sentiment in recent months. Investors are also fearing the economic shocks of the Ukraine conflict, with very high oil prices being only part of the issue.
Still, major altcoins appear to be performing better than BTC for now. The token’s total market dominance was close to its lowest levels this year, at 41%.
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