As the cryptocurrency market evolves beyond the Stock-to-Flow (S2F) model, attention has shifted to the Power Law framework for Bitcoin valuation. Current implementations of Giovanni Santostasi’s Power Law model, notably through Bitbo’s analysis, reveal BTC trading approximately 20% below its projected fair value. The model establishes key price thresholds: current valuation near $109,700, fair value at $136,100, with support and resistance levels positioned at $48,300 and $491,800 respectively. These parameters create a comprehensive framework for understanding Bitcoin’s potential trajectory throughout the current market cycle. The significant gap between current pricing and fair value suggests potential upward momentum, though market dynamics remain subject to external influences. Notably, emerging factors such as ETF fund flows present substantial potential to drive price movements toward either extreme of the established channel. Market participants continue monitoring these technical indicators while considering broader macroeconomic factors that could impact Bitcoin’s performance. The Power Law model’s persistence as an analytical tool demonstrates the ongoing search for reliable valuation methodologies in digital asset markets, particularly as previous models like S2F have demonstrated limitations in contemporary market conditions.
