Declining Returns on Leading Cryptocurrencies
Wedson emphasized that, in comparison to previous cycles, the returns on investment (ROI) for major cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), XRP, Cardano (ADA), and Dogecoin (DOGE) have been decreasing each year.
“With each cycle, the 1-year ROI rate for BTC, ETH, XRP, ADA, and DOGE diminishes. These leading cryptocurrencies no longer yield the substantial profits they once did,” Wedson remarked, noting that it is becoming progressively tougher to generate considerable wealth from a small initial investment.
Opportunities in New Projects
The analyst pointed out that investors are more likely to see significant returns by entering new projects during their early stages:
“The opportunity to achieve substantial wealth is confined to new projects where you can secure an average buy-in close to the launch price. However, this is a complicated process in itself.”
It’s important to keep in mind that smaller projects come with a high level of volatility risk, which may lead to a total loss of the investment, including the principal amount.
Impact of Leverage Ratios
Wedson also noted that rising leverage ratios in stock exchanges have negatively affected the market, stating, “Leveraged transactions lead to losses for many investors and deplete liquidity from the market.”
Reflecting on earlier times when 2-3 cryptocurrencies could yield profits of 10 to 100 times, he mentioned that currently this ratio ranges between 1.5 and 6 times at best:
“The chances of amassing wealth diminish with every cycle.”
Market Sentiment and Social Media Trends
Wedson pointed out the importance of sentiment and search trends on social media, stating, “Google searches have reached their recent local peak. When excitement is high, whales tend to sell.”
This is not investment advice!
