Murad Mahmudov, a prominent financial analyst, is convinced that a major altcoin season is not in sight due to the decline in the accumulated excess savings of American households.
Murad Mahmudov, a prominent financial analyst, is convinced that a major altcoin season is not in sight due to the decline in the accumulated excess savings of American households.
According to recent data from the Federal Reserve Bank of San Francisco, Americans have already spent their savings. The huge increase in savings during the period from March 2020 to August 2021 was driven by a huge drop in consumer spending.
According to economists at the San Francisco Fed, excess savings peaked in August 2021, surpassing a whopping $2.1 trillion.
Although these savings have now been largely exhausted, the report suggests that a strong labor market could allow spending to continue. That said, recent earnings reports from companies as big as Amazon They show that consumers are becoming more budget conscious.
Gamza KhanzadaevConsidering that Americans are now more careful with their spending compared to 2021, Mahmudov implies that they are unlikely to waste money on risky alternative cryptocurrencies.
“The most that can be expected is an occasional well-timed boost from a particularly prominent player of the month of the hot crypto-native PvP moneyball,” he said.
Tomiwabold OlajideThe analyst has also pointed out the fact that there is an oversupply of altcoins. “Altcoins are growing both in number and in fully diluted aggregate market capitalization with each new token launch,” Mahmudov added.
Comparing the current market cycle to that of 2017, the analyst noted that the market was much smaller back then, meaning less capital was needed to achieve significant gains. Additionally, it was much more difficult to create new tokens.
