Willy Woo, professional Cryptocurrency analyst and trader, provided his view on altcoins (cryptocurrencies that are not Bitcoin) and explained his reasons why he was no longer interested in these digital assets.
In one publication In his X account, Woo said that he has stopped talking about altcoins in years, although he did not rule out the possibility of the market witnessing a new “altseason.”
This term refers to a period where the cryptocurrencies that are not bitcoin (BTC) experience a significant increase in their price, surpassing the returns of BTC for a season. It occurs when investors and traders direct their attention and capital towards those digital assets, with the aim of obtaining higher profit margins.
In this regard, Willy Woo considers that this third altseason cycle is marked by memecoins, which he defines as “a mockery of the cryptocurrency space.” And he added: “It is not intended to be a disruptive technology that changes the world, just an honest bubble casino.”
As CriptoNoticias has explained, the cryptocurrency meme They are digital assets that pay tribute to a pet, Internet jokes or a political figure, whose usefulness is practically nil. That is to say, They do not solve any problem and are mostly used for financial speculation.. Its price can go up or down in a matter of seconds.
Altseason cycles
In the post, Woo stated that this cycle is different from the others as “the third cycle since retail began to be harmed on a large scale by the alternatives that burst into the general market in 2017.”
In this regard, for NYDIGmarket financial services company, The bullish cycle of 2017 was thanks to Ethereum-eth/” target=”_blank” rel=”noreferrer noopener”>Ethereumwhich facilitated a rise in Altcoin dominance due to its ability to capture market attention with its role as a platform for decentralized applications (dApps) and as a fundraising venue for initial coin offerings (ICOs).
In addition, in 2020, indicates that decentralized finance (DeFi), the tokens non-fungible (NFT) and emerging network competitors Ethereum took center stage in the altcoin spotlight.
“The year 2020-21 was a year of “innovation” in DeFi and NFT, but many retailers were once again hurt,” Woo concluded, while saying:
“This third alternative cycle is about meme coins, which is a mockery of the crypto space. “It is not intended to be a disruptive technology that changes the world, just an honest bubble casino.”
Willy Woo, professional cryptocurrency analyst and trader.
Bitcoin maintains its dominance
The specialist also mentioned the BTC dominance graph, which shows that investors are overwhelmingly leaning towards the digital currency created by Satoshi Nakamoto. “The dominance graph looks like a collapse and recovery over a decade. Like COVID crash in slow motion… Everyone freaks out, it’s the end of the world, alts are going to flip BTC, then normalcy and sentiment returns and the chart goes back to bullish mean to long equilibrium term,” he commented.
BTC’s dominance in the capitalization of cryptoassets, excluding stablecoins, has increased steadily over the last two years. Currently, it represents close to 60%. This movement reflects a lower investment preference in altcoins, that is, in crypto assets other than BTC.
Bitcoin dominance in the last 7 years. Fountain: TradingView.
To complete his reflection, Woo clarified that for him there will be altcoin seasons in the future. But he highlights that “they will be weaker in each cycle starting with the great bubble of 2017.”
Furthermore, he recommended investors who wish to trade altcoins not to hold long-term positions. He argued that unless they have a deep understanding of the market, it is risky to do so.
Will there be an altseason?
The organization Blockchain Center has developed an index that seeks to objectively determine whether or not there is an altseason.
As explained on their website: “If 75% of the top 50 coins performed better than bitcoin during the last season (90 days), then it is altcoin season. “Stablecoins (Tether, DAI…) and asset-backed tokens (WBTC, stETH, cLINK,…) are excluded from the top 50.”
At the time of this publication, the altseason index value is at 31 points, so we are not in an altcoin season.
Investing in altcoins can offer higher returns than BTC due to their lower market capitalization, which makes them more volatile.
However, its volatility also carries greater risk, as losses on altcoins can be significant. Therefore, It is crucial that investors implement effective risk management strategies when participating in these markets.
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