Cryptos rallied earlier this year, but have traded sideways over the first half of 2023. However, with May behind us, many cryptos are tumbling. If we look at the broader market, it is visible that this selloff is not heavily impacting safe and practical crypto projects. Instead, we are seeing investors sell off risky and out-of-date names and readjust their portfolios.
Accordingly, the market capitalization of the crypto market as a whole has not seen much of a decline. Big-cap cryptos like Bitcoin (BTC-USD) and Ethereum (ETH-USD) are still retaining their value, and remain relatively safe picks.
Of course, the crypto market still looks healthy from a long-term perspective, considering the upcoming Bitcoin halving event and anticipated rate cuts later this year. But not all projects have the same potential, and it is a good time to de-risk your crypto portfolio by selling off tokens that are either too hot right now, or outright risky.
Let’s look at three such cryptos to sell in June.
Toncoin (TON-USD)
Investors looking for stable cryptocurrencies that can withstand market volatility often turn to Toncoin (TON-USD). Unfortunately, TON has lost nearly 25% of its value over the last month, and there is a significant risk that it could decline further in the coming months.
A linked wallet from the collapsed FTX exchange still holds 32.25% of all Toncoin, while another wallet holds 31.3%. The top 10 holders control 80% of this dying project. Thus, I recommend taking the exit as soon as possible.
Even if you are chasing value, this token’s bearish momentum makes it a risky play. There are better projects with significant growth potential that offer better value. Thus, Toncoin is one of the top cryptos to sell in my book.
BNB Coin (BNB-USD)
The Binance exchange has been under regulatory trouble recently, and the recent developments do not bode well for its native currency, BNB Coin (BNB-USD). This is the largest centralized cryptocurrency exchange, and I believe a crash here would be catastrophic for the wider crypto space.
Many believe it won’t happen due to Binance’s resiliency during previous periods of mass withdrawals. However, it is important to remember that Binance is still very elusive, and people have little insight into how it operates and where its headquarters are. The risk with this token is substantial, and with the Securities and Exchange Commission putting forward 13 charges against the company, I’d start dumping Binance-related assets before things go south.
Of course, the SEC is not alone in targeting Binance. The Commodity Futures Trading Commission (CFTC) has also sued Binance for violating U.S. financial laws by offering unregistered derivatives trading to U.S. customers.
Binance has also faced regulatory pressure from several other countries, including the U.K., Germany, Japan, Singapore, Canada, Thailand, and Hong Kong. Some of these countries have banned or restricted Binance’s operations, while others have issued warnings or investigations.
Injective (INJ-USD)
Injective (INJ-USD) is a crypto that I’m staying away from. Despite its impressive performance this year, an a relatively impressive amount of utility provided by this project, I think it’s time to sell.
Injective is trading near its 2021 all-time high in terms of market capitalization, which is a red flag for me. It has a valuation of $556 million, close to its peak of $621 million in 2021. Thus, there is little room for upside and a lot of downside risk. Any negative catalyst could trigger a massive selloff.
Injective also has a huge inflation problem. It has an annual inflation rate of 41.21%, one of the highest among Web 3.0 cryptos. The tokenomics here remain unattractive, and I would rather put my money in more solid and reliable cryptos with lower inflation and much more compelling entry points.
Therefore, I think Injective is a bad investment that investors should steer clear of or dump at the current price point. Of course, Injective could still surprise us with some positive price action, but the cons here are hard to ignore.
Small, low-volume cryptos
On Low-Capitalization and Low-Volume Cryptocurrencies: InvestorPlace does not regularly publish commentary about cryptocurrencies that have a market capitalization less than $100 million or trade with volume less than $100,000 each day. That’s because these “penny cryptos” are frequently the playground for scam artists and market manipulators. When we do publish commentary on a low-volume crypto that may be affected by our commentary, we ask that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.
Read More: How to Avoid Popular Cryptocurrency Scams
On the date of publication, Omor Ibne Ehsan did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
