Altcoins
Main reason why the major Altcoin season is not coming
Alex Dovbnya
Murad Mahmudov, a prominent financial analyst, says that a new altcoin season is very unlikely.
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Murad Mahmudov, a prominent financial analyst, is convinced that a big altcoin season is not on the horizon due to the decline in cumulative excess savings of US households.
According to recent data data According to the Federal Reserve Bank of San Francisco, Americans have now spent their savings. The massive increase in savings over a period from March 2020 to August 2021 was caused by a sharp decline in consumer spending.
According to economists at the San Francisco Fed, excess savings reached their peak in August 2021, surpassing a whopping $2.1 trillion.
Although these savings are now all but gone, the report suggests that a strong labor market could help maintain spending. That said, recent earnings reports from companies as large as Amazon show that consumers are becoming budget conscious.
Considering that Americans are now more cautious in their spending compared to 2021, Mahmudov implies that they are unlikely to spend money on risky alternative cryptocurrencies.
“The best you can hope for is an occasional well-timed spike from a particular crypto-native PvP moneyball month outperformer,” he said.
The analyst also highlighted the fact that there is an oversupply of altcoins. “Altcoins are increasing in both number and overall fully diluted market capitalization with each new token release,” Mahmudov added.
Comparing the current market cycle to that of 2017, the analyst noted that the market was much smaller then, meaning less capital was required to make significant gains. Additionally, it was much more difficult to create new tokens.
About the Author
Alex Dovbnya
Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience covering everything related to this booming industry, from price analysis to blockchain disruption. Alex has authored over 1,000 articles for U.Today, CryptoComes and other fintech media. He is particularly interested in regulatory trends across the world that are shaping the future of digital assets. He can be contacted at alex.dovbnya@u.today.