Wall Street Investment Bank Report: Cryptocurrency is Promoting U.S. Luxury Consumption

Wall Street investment bank Jefferies has released a new report stating that cryptocurrency has spawned a new generation of luxury consumers in the United States.
In the United States, the gap between the rich and the poor has never been so obvious. In the past ten years, the gap between the rich and the poor has been quite obvious, but now with the inflation rate hitting a record high and supply chain problems, the United States is being divided into two parts: the rich and the poor.

But thanks to cryptocurrencies, this situation seems to be changing. According to the report, China still ranks first in the field of consumer spending. However, in the past four quarters, the United States has become stronger and stronger, which may be related to the popularity of cryptocurrencies-especially among young people.

The report pointed out that NFT purchases have increased significantly, mainly by the younger generation. Many young people in their 20s are buying NFTs and other crypto-related items for friends and relatives this holiday season. For some people, the days of giving away fruit cakes and skateboards may be over, and they now see encryption as a new way to provide wealth and lasting goods.

Although the prices of NFTs vary, they are tokens linked to physical assets such as artworks, so they are generally considered a reliable investment.

Flavio Cereda and Kathryn Parker, the analysts who wrote the report, explained: "In addition to the natural impact of the so-called "repressed demand"... we have noticed a surge in asset values (from the stock market to real estate to contemporary art). , The significant impact of cryptocurrency wealth has once again increased the total amount of cash transactions. As much as 20% to 25% of sales (in the past 12 months) may be caused by this phenomenon.”

The report also pointed out that luxury consumption has since returned to its highest level since 2019. 2020 is the peak of the outbreak of the new crown, and expenditures have fallen. By 2023, American luxury goods consumption may account for about 45% of American consumption habits.

The report said, "This is highly dependent on the flexibility of the underlying assets that allow monetization, so it has implicit volatility, but at least it will not be at the risk of increasing government pressure like China."