Cryptocurrency analyst Joao Wedson made striking assessments of the current market conditions.
Wedson argued that compared to past cycles, the returns on investment (ROI) of leading cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), XRP, Cardano (ADA), and Dogecoin (DOGE) have been declining to lower levels each year.
“With each cycle, the 1-year ROI rate for BTC, ETH, XRP, ADA, and DOGE shrinks. These major cryptocurrencies no longer provide the huge profits they used to,” Wedson said, adding that it is becoming increasingly difficult to amass large fortunes with small capital.
According to the analyst, investors are only likely to achieve high returns by taking positions in new projects at an early stage:
“The chances of getting truly rich are limited to new projects where you can get average buy-in close to the launch price. But that's a complex process in itself.”
However, let us remind you that the volatility risk of small projects is very high and may result in the loss of the entire investment, including the principal.
Wedson also stated that increasing leverage ratios in stock exchanges negatively impacted the market, saying, “Leveraged transactions cause losses to many investors and drain liquidity from the market.”
Recalling that in the past, 2-3 cryptocurrencies could generate 10 to 100 times profit, the analyst stated that today this ratio is between 1.5 and 6 times at best:
“The chances of getting rich decrease with each cycle.”
Wedson also highlighted sentiment and search trends on social media, saying, “Google searches have hit their recent local peak. When everyone's excited, whales are selling.”
*This is not investment advice.
