I can say with some conviction that the bull market for cryptocurrencies is likely to sustain. Bitcoin (BTC-USD) seems to be in a consolidation zone. With the likelihood of rate cuts, I expect a fresh rally for Bitcoin and other cryptocurrencies. However, even in the biggest of bull markets, there can be destroyers of wealth. The focus of this column is to identify three meme coins to sell before they decline further.
It’s worth noting that in the last 30 days, Bitcoin has trended lower by around 7%. This is a small correction within a bull market. During the same period, Beam (BEAM-USD) and Celestia (TIA-USD) have declined over 40%. I mentioned these two coins because they are in the top 100 based on market capitalization. The key point is that there will continue to be wealth destroyers in a high-beta crypto market.
Therefore, let’s talk about three meme coins to sell before it’s too late.
PepeCoin (PEPE-USD)
Dogecoin (DOGE-USD) and Shiba Inu (SHIB-USD) have survived multiple bearish phases for cryptocurrencies. Dogecoin continues to have the backing of Elon Musk and Shiba has been expanding on its ecosystem and utility. If I had to bet on meme coins, I would consider these two names rather than look at something relatively new.
PepeCoin (PEPE-USD) is ranked among the top 25 coins in terms of market capitalization. A valuation of almost $5 billion seems stretched, and I believe that PEPE is likely to trend lower from current levels. The meme coin has corrected by 23% in the last month, but that’s small when compared to a rally of 650% in the last 12 months.
I also believe the token economics for PEPE coin is unattractive. A total supply of 420.69 trillion does not seem to be a concern as of now. However, if there is a loss of confidence and few big investors exit, there can be a meltdown. A recent report indicates that a crypto market whale has strategically shifted funds from PEPE to Ethereum (ETH-USD).
Bonk (BONK)
Bonk (BONK-USD) is another meme coin to sell. It’s worth noting that BONK has skyrocketed by 6,500% in the last 12 months. With a market capitalization rank of 65, the meme coin seems to be pricey.
Therefore, the best part of the rally might be over, and I see high risk at current levels. My view is underscored by the point that BONK’s price prediction for 2030 implies an upside potential of 310% from current levels.
In terms of positives, BONK has over 120 integrations across 9 separate chains. The ecosystem of integrations has, therefore, been robust. In the gaming segment, BONK has 25 integrations and is an emerging in-game currency across blockchain gaming.
However, these factors are not unique in the world of cryptocurrencies. The rally in BONK has largely been driven by euphoria. Once investors find cheaper alternatives, money is likely to flow out of BONK.
The token economics also does not seem to be attractive. The current circulating supply is 66.3 trillion, with a total supply of 93.5 trillion. Further, the supply inflation is high, and if a few whales exit, there will likely be panic.
Floki (FLOKI-USD)
In terms of market capitalization, Floki (FLOKI-USD) is the fifth largest meme coin. Further, if we look at the top 10 meme coins, FLOKI has been the worst performer over a 30-day period. Of course, this is not the only reason to be bearish on FLOKI. I, however, believe the downtrend is likely to sustain.
If we look at the price prediction, FLOKI has an upside potential of 295% from current levels by 2030. The technical seems to suggest the best part of the rally is over for the meme coin.
The risk of scams is another factor that has impacted sentiments. Recently, Floki issued a scam alert on fake tokens on the Solana (SOL-USD) and Base blockchains.
Another recent news indicates Floki investors are liquidating their holdings to buy Mpeppe (MPEPE-USD). The reasons include “potential for higher returns, innovative betting features and strong market predictions.” I would, therefore, remain cautious about fresh exposure to FLOKI. Further, profits can be booked, and a switch to stronger projects can be considered.
On the date of publication, Faisal Humayun did not hold (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.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
