I think Plan B answered this paradox many times
In my thread
Stock To Flow Model: Modeling Bitcoin's Value with Scarcity there are a few hints about this:
Q2.
“Oh, is the halving priced in?” and I think this does speak on where you stand on other debates; for example, the efficient market hypothesis. So, as an Austrian, and even Saifedean himself I think has made a similar comment on this saying, “Look, knowledge is not given to everyone equally, and so we should not anticipate that what might be called the strong form of the EMH, or even perhaps the weak form of the EMH, is not a good way to think about things,” but then there are others from the Chicago School and other schools of thought that may believe in that more. Where do you side on that?
PlanB: That’s a very interesting point. Actually, that’s one of my first charts, the halving chart with the color overlay; it shows the Bitcoin price with the months until the next halving; and you can clearly see from that chart that the halving is not priced in, or at least was not priced in the last two times. So, my best guess would be it is not priced in now, next halving May 2020, but the efficient market hypothesis. It’s kind of weird. It should be priced in, of course. In fact, I’m a big believer of the efficient market hypothesis, or at least it should be used as a first starting point for most people that don’t have inside information, or specialized knowledge, or a big trading room available. The efficient market price is the best price there is, they can rely on that, and that’s especially true if markets are really big and liquid and efficient, and I think that’s true for the Bitcoin, in a sense. It’s like an $80 billion market.
SLP67
Q4
Stephan Livera: Yeah, it’s fascinating stuff. And this table that you’ve got, so you think, so just for the listeners, it’s showing the year, the halving, and the model predicted price. So as you said 50,000, 400,000, and then 3.2 million for the 2028 halving. Now, to the extent that stock-to-flow modeling works, so again caveat, this is not economic law, it’s some sort of modeling, but to the extent that the modeling works. Do you have any reflections on how many cycles we could anticipate this working for?
PlanB: Yeah, that’s also a discussion on Twitter, lots of questions about exactly this infinite value if you wish. If you follow the table, we could go all the way to 2140 when the flow is zero, when there’s no more new bitcoins, only fees. And the theoretical value how to stock to flow model would be infinite. So how can that be? And basically I think this is a very theoretical argument. And I’m a very practical guy. So if I look at the next three halvings alone. So we’re now at, say, 100, $200 billion market. Every halving this market goes 10X. So after 2020, we go to one trillion, after ‘24 we go to 10 trillion. And after ’28, so the third halving we go to a 100 trillion US dollars, hence my name, my Twitter handle.
PlanB: I think that we don’t have to wait until 2140 before the model breaks or before something breaks. I think we’ll be there sooner than we think. I think we’ll be there well, maybe 24. Somewhere between 24 and 2028 because 10 to $100 trillion Bitcoin market that’s enormous if you compare it to the US dollar for example. It has a monetary base of three trillion, and I think an M2 of about 12 or 14 trillion. So then that means that somewhere between 2024 and 2028, bitcoin is bigger than the US dollar. It basically means the US dollar will die, and we’ll be measuring things in Bitcoin.
Stephan Livera: Very bullish.
Here the image detailing what they were referring to:
Twitter linkSo there’s no such thing as 25th halving pricing in. Something is going to break before than that: either BTC or USD.
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