The relationship of bitcoins price to these halving cycles so talk us through a little bit about what the stock to flow model is and then what its showing us. So far, yeah, so the stock to flow ratio is a ratio from the commodities market. Actually that that tells you something about an assets, scarcity um. It divides the stock, the reserves of a certain assets by the flow, the newly issued bitcoins or or gold newly mined gold. And if you divide the stock by the flow, you get the stock to flow ratio. So that ratio was known for ages in the commodities market. What i did was connect that with the market value of uh well bitcoin in the beginning, but later also the other assets like silver and diamonds and gold and real estate, and what you find that there is a perfect linear relationship in the uh logarithmic space. So that was quite shocking, and and with that you can, you can actually predict the price of bitcoin very roughly, i should say, but you can do it and because we know the stock to flow ratio of uh of bitcoin, its its pre programmed and thats yeah. Thats, a very nice thing and its, of course, very bullish, uh at the moment it predicts um somewhere around thousand dollar bitcoin for the current halving cycle, which is 2020 2024., so were actually heading towards that. Tell us more about the institutional interest, whatever you can share, whether its uh organizations that you work at or have worked at or uh just kind of conversations with uh former colleagues peers people.

You know in the industry whats the general sense from the institutions in terms of bitcoin uh, what theyre allocating how theyre thinking about those allocations yeah so im, amsterdam, based. I talk a lot with european investors. Some some us investors, but its its mainly a european uh perspective that i have well. Certainly, the companies that i worked were not very interested in in bitcoin yet because, mainly because of uh regulation and and well misinformation uh, if you will, because they most of them, thought it was for criminals, it was for um and governments would ban it and all That and and and of course, for an institutional party like a bank or an insurance company uh, they have capital regimes uh with their uh central bank, so theyll have to put capital aside uh for every investment they make if the investment is more more risky, like Bitcoin they have to park more uh capital for that investment and for bitcoin its only is its almost one to one. So if they, if they were to uh a billion dollars in bitcoin, they would they would have to park one billion dollars in equity as well and – and that is of course not more doable its more doable for um for hedge funds. So what i see is it its not the big institutions, pension funds, insurance companies and banks that are investing on their own balance sheet or are interested in bitcoin, but it is the hedge funds, the family offices very much so, and commodity investors, especially the gold and Uh commodity investors are, of course, very much into the same philosophy that bitcoins have with uh sound money, yeah, so family officers, commodity investors and um hedge funds.

Those those are the the ones i see active and the other ones are, will be late as usual and when you wake up in the morning like what do you check? First whats, the data sources that you find most valuable, um or in terms of just understanding. Whats happening in the market, whether its the short term or long term period. Well. To be honest, the price is one of the first things uh the bitcoin price, one of the first things i check because thats the most yeah accurate and timely information. If, if its the same as as whenever you went to bed, then nothing happened if its uh. If, if it has a big delta, then something happened, and then i go on twitter, which i find is my the most direct and and Music an accurate information source. There is because yeah well, one thing i learned is to to not read: mainstream media or watch mainstream television, or even media sources like like cnn and bloomberg, or the wall street journal that are considered the creme de la creme in institutional. Investing ive learned that, with these new investments like like bitcoin, you better, ditch those standard sources and and go to twitter and the experts in the field, because thats the the most direct way of getting information yeah and when you think about portfolio construction uh. For yourself or for the institutions, maybe both um is this still something that is like a very small allocation, or is it something that uh is being used to like denominate the whole portfolio, or how do you just think about the portfolio, construction and any sort of Concentration uh targets – i think for institutions of course, thats very important to uh to keep the risk profile sort of constant and within their mandate.

So theyll uh theyll have to sell bitcoin as soon as it rises uh to keep to keep the the concentration uh low and within mandate uh boundaries, but with uh hedge funds or family offices or uh, or for my own investments. I dont have those those mandates or boundaries, so i can what i see in practice that what starts as a small investment a a couple percent investment in in bitcoin, soon uh grows to a uh, a double digit position in in bitcoin and well after a few Years, four or five years it it sort of dominates your portfolio. That sure is true with my my own investments as well. What do you think is uh the likely price for bitcoin by the end of the year and do you think that the bull market ends at the end of the year or does it carry us into the beginning of 2022? I would be very very surprised if bitcoin price would be below 100 000 dollars at the end of the year. That would well sort of invalidate my view, my models and uh. That would that would certainly surprise me. I i do think uh. We will see a price that is uh at least 135 thousand dollars by christmas, because thats what my floor model says and basically im using three kind of models that that all say the same thing so stock to flow, which has a hundred thousand on average. For the entire cycle, mind, you were one and a half years into that cycle and with below 100 000 prices so well have to to spend the next two and a half years markedly above 100, 000 to make that that average and the second model i use Is the unchain stuff um that that unchanged stuff is really good at identifying bottoms and peaks? So uh were now talking peaks, of course, so i know quite well certain not not guaranteed, but but i i will have high high confidence in that the unchain indicators will signal a top and if you, if we look at the unchanged signals right now, i would Say that top is at least a couple of months say six months uh from here, so so that would be nfq1, maybe maybe later and then the third kind of models that i use of course, that floor model 135 uh a thousand thats thats, not based on Stock to flow its its its based on other its a proprietary thing, but its not based on other stuff, technical and on chain.

I guess we will be above a hundred thousand above 135 000 at the end of the year and then well continue to grow, maybe towards the stockton floyd x, model targets, 288, uh or even above. I would not be surprised even to see in q1 or q2. Next year, prices of uh, 300, 400, 500 000 uh dollars, but i do think um and – and i noticed you were talking before in this – show – that im a full bull that im foolbull. I am right now, but im quite sure that there will be a time when i switch from bull to uh to bear, like i did in at the end of 2017 im a bit bit of struggling with that because i i dont i i i dont want To disclose it because i want to at least disclose it responsibly and not be responsible for triggering the bear market, so people have ideas for that. I um i i think theyre very welcome, and and so when you think about that 288 uh thousand dollar price. I think a lot of people have heard you say that before uh, but when you say that it could go higher 300. 400. 500. 000. Is that just pure uh kind of fomo and a blow off top uh that drives that? Or is there something else that youre looking at that shows that hey? Maybe we do go past, that 288 um, that the stock to flow model has there? No, no, that that will indeed be a fomo and – and that will be very uh, clearly marked in the unchained um analysis, which is looking for certain kinds of transactions that i, which i called them before.

But those are fomo transactions. So so, if if, if i, if the, if the algos um uh see the fomo kind of transactions coming in, then the end is near um and yeah. So so i would envision like, for example, going to 500k uh somewhere q2 or something and then crash back. Maybe 80 again to to 100k have a bit of a bear market and then continue another cycle starting uh with the halfing in 2024., going from uh, 55 57 000 today to 500k and q2 back down to 100k and then continuing into the next halving while it Sounds crazy to uh to a lot of people. Uh would be pretty consistent with what weve seen in the past in terms of volatility uh, both up and down so its uh.

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