👨🔬What is Bitcoin's Power Law theory?
A theory proposed by Giovanni Santostasi
Last updated
A theory proposed by Giovanni Santostasi
Last updated
The Bitcoin Powerlaw theory proposed by Giovanni Santostasi, is a mathematical model suggesting that Bitcoin's price follows a power law distribution.
This model predicts that Bitcoin's price tends to grow according to a power law curve, indicated on a log-log chart.
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This implies that while short-term price variations are significant, there is a predictable and steady trend over the long term.
The theory is based on two main principles:
Logarithmic Growth: Bitcoin's price grows not exponentially but according to a power law, indicating sustainable and predictable long-term growth.
Fractal Relationships: Bitcoin's price variations follow fractal patterns, suggesting a self-similar structure in price fluctuations across different time scales.
To understand the theory in full, we recommend watching these videos:\
Using mathematical models based on the power law, it is possible to estimate future Bitcoin price trajectories.
This involves analyzing historical data and projecting power law curves to predict future prices.
The main limitations include:
Bitcoin's Volatility: Predictions can be influenced by extreme market variations.
Unpredictable Events: External factors or unforeseen events can significantly deviate prices from theoretical projections.
More details and analyses on the Bitcoin Powerlaw can be found in Giovanni Santostasi's posts on Medium and other finance and cryptocurrency articles and blogs, such as those on CoinTelegraph and Decrypt.
Here on Reddit, the first post pubblished from Giovanni about Power Law Theory in 2018.
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