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How Does ‘Stock-to-Flow’ Model Relate to Scarcity?

The stock-to-flow model measures scarcity by dividing the current circulating supply ('stock') by the annual production ('flow'). A higher stock-to-flow ratio indicates greater scarcity because it takes longer to produce the current supply.

This model is often used to predict the long-term value of scarce assets like Bitcoin.

How Does the Reserve Ratio Affect the Intrinsic Value of a Collateralized Stablecoin?
What Is the ‘Staking Ratio’ and Why Is It a Key Metric for PoS Networks?
How Does the “Stock-to-Flow” Model Attempt to Value Scarce Cryptocurrencies?
What Is the Significance of a Token’s Total Supply and Circulating Supply?