According to crypto analyst PlanB, who popularized the Bitcoin stock-to-flow model, understanding the world’s largest cryptocurrency comes down to just three things—its Sharpe ratio, its correlation with other assets, and cointegration with the stock-to-flow model.
Boiling down Bitcoin to three crucial ratios
While Bitcoin’s unique proposition attracted hundreds of millions of people in the ten years since it was created, it might take another ten before it attracts the same amount of institutional interest.
That isn’t to say that traditional financial companies have turned a blind eye to the world’s largest cryptocurrency—they just need a gentle push to realize the potential the industry has. With institutional investors being a notoriously difficult crowd, breaking through…