It can be tough to sort the cryptos to buy from the cryptos to avoid.

Many crypto investors inherently recognize the allure of throwing money into the market: Cryptocurrency has simply grown at a tremendous rate overall even including the scams and rug pulls.

That truth has resulted in large returns in some very dubious projects, especially during the pandemic. The cryptocurrency market is maturing rapidly, though, and that won’t be possible moving forward. 

Instead, investors are going to have to decide between utility and cryptos to avoid when it comes to where to put their capital.

Fortunately, it’s a very easy distinction to make. Cryptocurrency is increasingly being integrated into our financial system. It isn’t something to be avoided completely.

Invest in utility and avoid projects that lack utility. That’s the clearest litmus test any serious crypto investor with a long-term perspective should take. 

Cardano (ADA-USD) 

Cardano (ADA-USD) is the sole crypto to own that I discuss in this article. I will remain a fan until it heads to zero. To be clear, that is not going to happen.

In fact, I believe the complete opposite is going to happen. It’s all about utility. 

Cardano is well-known for its strict adherence to empiricism. The project is being built with strict deference to research as its guiding principle. The world of cryptocurrency is rooted in novel approaches to computer science.

Cardano understands that. Thus, it bases its development on what the research suggests will work. That is going to lead to a technically sound cryptocurrency in the long run. 

Beyond that, Cardano is also utilitarian in the sense that it is among a select group of cryptos that are adopting ISO 20022 compliance standards that govern the financial industry.

It will invariably become more utilitarian in the sense that it is working within the confines of the current financial system. That promises to spike its adoption in the coming years. 

Pepe (PEPE-USD)

Pepe (PEPE-USD) is the news meme coin to gather significant support. They fashioned the coin after the frog mascot featured in the Boy’s Club comic strip.

Pepe has been featured everywhere and gained fame across the internet. The frog icon was popular in the Hong Kong protests that garnered attention globally and has also been associated with right-wing movements as well.

Its creator approved of its use in the former but took issue with its likeness in relation to the latter. 

That popularity is the reason that Pepe was created. It uses that fame and has attempted to leverage it to gain fortune in the cryptocurrency space.

It isn’ t working. In fact, Pepe is one of the no-brainer cryptos to avoid.

When it began trading in April there was a brief period of massive returns. It went to the moon in early May. Congratulations to the lucky few who made out like bandits when that happened. However, since then it has steadily fallen. 

Pepe holders can only standby and hope that it spikes and that those spikes create profitable positions for them. The smart ones will get out if and when that occurs. 

Shiba Inu (SHIB-USD)

Shiba Inu (SHIB-USD) is another meme coin that I do not recommend.

That said, I do believe that crypto investors will continue to pile into SHIB no matter what. Shiba Inu is up overall. It has grown by 540,000% over its lifetime and that’s hard to ignore.  

That growth is a consequence of growing from a value of a fraction of a penny to a fraction of a penny with fewer zeros following the decimal point.

The novelty of that dramatic increase has worn off. It’s clever marketing and nothing more. It was born out of a desire to disrupt Dogecoin (DOGE-USD) as the ‘it’ meme coin.

In truth it means very little in any business sense. No value is being created because no utility is being created. 

The value in Shiba Inu is because $4.3 billion of capital is collectively invested in it now. Smart investors can play the short-term fluctuations and profit from others who keep their capital in Shiba Inu over the long term. That’s all. 

On the date of publication, Alex Sirois 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.