Stock-to-flow models are traditionally used to predict the price of a store-of-value commodity, like gold or other precious metals, by comparing the current available supply of the commodity against the in-flowing supply, or amount mined.

Store-of-value commodities are not usually consumed in industrial applications, and instead are commonly used as hedges against economic turbulence. Historically, Bitcoin has acted as an excellent store-of-value and has followed the stock-to-flow model quite closely.

Every 4 years, Bitcoin mining rewards are cut in half, greatly reducing the inflow of new Bitcoin on the market. This causes increased scarcity and has led to several large price rallies over the last 8 years. The stock-to-flow model predicts that Bitcoin will reach a price of $100k sometime between 2021 and 2025.