PlanB, the infamous creator of the stock-to-flow (S2F) model for Bitcoin, has apparently abandoned the HODL strategy in favor of “quantitative investing” via ByBit.
In a tweet on Friday, he announced a “copy my exchange” partnership with ByBit that “outperforms buy&hold 100x”. An article detailing the strategy was published on Monday via PlanB’s website.
The article on quantitative investing is almost ready. It includes a trading rule that surpasses the 100x buy&hold. You can copy my exchange here (registration + deposit): https://t.co/8OI2agrLDD pic.twitter.com/jgW8AmCjlc
— PlanB (@100billionUSD) August 5, 2022
PlanB and the Stock-to-Flow model
The creator of S2F has amassed a large following online after creating the methodology by which many investors speculate on the future price of Bitcoin.
The model is based on the fixed supply of Bitcoin and its predefined release schedule tied to Bitcoin halvings. According to the stock-to-flow model, the price of Bitcoin will reach nearly $1 million by 2026.
Historically, the S2F model has been surprisingly accurate; however, in the recent bull run, there has been an increased number of crypto natives who have given up on the legitimacy of the theory.
As early as June 2021, Ethereum founder Vitalik Buterin described those who believe in the model as deserving “all the laughs they get.”
Stock-flow really doesn’t look good now.
I know it’s rude to gloat and all that, but I think financial models that give people a false sense of certainty and predestination that numbers will go up are harmful and deserve all the teasing they get. https://t.co/hOzHjVb1oq pic.twitter.com/glMKQDfSbU
— vitalik.eth (@VitalikButerin) June 21, 2022
The methodology claims that buying and holding Bitcoin offers the safest method to invest in Bitcoin due to the assumption that it will continue to follow the predicted price within a given time frame. The price may deviate from the pattern over a period of time, but it will eventually return to the stock-flow line due to the fixed supply and distribution of coins.
Criticism of S2F has increased during the bear market as the price of Bitcoin is now well below model predictions and has been since December 2021.
Quantitative trading and 100x returns
PlanB seems to have taken the opportunity to deviate from the “buy&hold” philosophy to promote a new trading system in collaboration with ByBit. His strategy will allegedly beat a HODL approach by “100x” and can be copied via ByBit now that his new article on “quantitative investing” has been published.
He claims to receive “the same reactions as when I published the S2F article in March 2019”. Still, most criticism comes from those questioning the move away from HODLing and towards the copy trade, whereby PlanB will indeed receive a bribe from ByBit. The trade copy page of ByBit’s website states that top traders can receive “up to 30% commission and 500 USDT bonus.
Funny to see the same reactions as when I posted the S2F article in March 2019 when BTC < $4,000 and called for $55,000. "scammer" "request not within model" "$55,000 impossible".
Now people can’t imagine B&H outperforming 100 times in 10 years and hating the exchanges. Let’s wait for the article. https://t.co/tjDpqnA2Nx— PlanB (@100billionUSD) August 6, 2022
The quantitative trading strategy is described in full in PlanB’s article titled Quant Investing 101.” The basic philosophy appears to be based on trading Bitcoin’s RSI levels tested over the past ten years.
The trading rule used by PlanB for the strategy is detailed below.
“IF (RSI was above 90% for the past six months AND falls below 65%) THEN sell,
IF (RSI was below 50% in the last six months AND jumps +2% from the low), THEN buy, ELSE hold. »
For more details on how ITM options are used to optimize returns, see the full article on the PlanB website.
Responsible strategies for “influencers”.
Hodlonaut, author of the Bitcoin Zine, Citadel21, tweeted his dismay at the concept of PlanB joining forces with what they call a “leveraged shitcoin casino” and giving up on “buy and hold.”
Wait, did I understand correctly? PlanB telling people to register with a leveraged shitcoin casino so they can copy its trades and get 100x more btc than if they just buy and hold?
I must be misunderstanding something, right?
Right?
— hodlonaut 🌮⚡🔑 🐝 (@hodlonaut) August 7, 2022
Swan Bitcoin’s Cory Kilppsten, one of the first to identify problems at Celsius, went so far as to call PlanB a “scam artist”.
MapBrandolini @100billionusd is a quack asshole. What an absolute joke. pic.twitter.com/9sbMgakoQ1
— Cory Klippsten (@coryklippsten) August 6, 2022
Crypto trader Eric Wall extended the sentiment that PlanB is no longer relevant in the industry, saying “Bitcoin maxis didn’t champion this charlatan.”
Luckily the Bitcoin maxis didn’t defend this charlatan… Saifedean, Adam Back, Caitlin Long, Vijay Boyapati, Pierre Rochard, Bitstein, Preston Pysh and a bunch of other Swan advisors, plus almost every bitcoin podcast were a minority irrelevant in the grand scheme of things
— Eric Wall (@ercwl) August 7, 2022
Also, PlanB’s article on quantitative investing raises an interesting issue as it states that
“Nothing in this article is financial advice. All content is for informational and educational purposes only.
However, the article was identified as a precursor to its copy trading strategy on ByBit. So while PlanB may state that it does not provide investment advice, it then tricks users into following this strategy by copying its “quantitative investing” trades.
PlanB claims to offer its trades information for free on Twitter, allowing for a “DIY” option. Furthermore, he confirms that he only trades 10% of his portfolio “mainly due to credit risk”.