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3 Cryptos to Avoid No Matter What Your Friends Say

Stay wary of these cryptos to avoid which are otherwise tagged as “popular.”
Shiba Inu (SHIB): The coin offers no competitive advantages or differentiation.
Dogelon Mars (ELON): This token has no real-word use, except outside a few…

  • Stay wary of these cryptos to avoid which are otherwise tagged as “popular.”
  • Shiba Inu (SHIB): The coin offers no competitive advantages or differentiation.
  • Dogelon Mars (ELON): This token has no real-word use, except outside a few crypto exchanges.
  • Floki Inu (FLOKI): Another coin that lacks real-world use, with most businesses fleeing from this crypto.

Source: eamesBot / Shutterstock

The growing craze around various meme tokens took full flight last year. Many major community-focused tokens, with little in the way of real-world utility, saw million-plus percentage gains in the matter of months. This has contributed to a speculative rush to add risk, which is currently being unwound in the market right now, as most investors target these tokens as cryptos to avoid in this environment.

There’s something to this view. The macro environment for speculative risk assets has deteriorated greatly of late. Indeed, rising interest rates and a lack of cheap capital provide downside catalysts for the riskiest of assets.

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We’re seeing downside pressure across most meme tokens and higher-risk equities, such as technology stocks, right now. Currently, it appears this trend has lots of room to run. That is, until the Federal Reserve comes in and saves the day once again.

Let’s face it, investing in cryptos was never ideal for the faint hearted. As a matter of fact, digital assets have always traversed extreme volatility throughout their existence. Thus, perhaps there’s an argument to be made that now is a good time to pick up some of these meme tokens. But I sure don’t see one.

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So, here’s why I think it’s time for investors to ignore the noise on these three cryptos to avoid right now.

SHIB
Shiba Inu
$0.000011
ELON
Dogelon Mars
$0.0000004846
FLOKI
Floki Inu
$0.00001007

Shiba Inu (SHIB)

Shiba Inu (SHIB-USD) or Shib coin standing centrally placed among bunch of crypto coins on blue background. Close-up, soft focus. Banner with golden Shiba token.Source: salarko / Shutterstock.com

Shiba Inu (SHIB-USD) undoubtedly became one of the most unlikely investment winners of 2021. Indeed, the token soared more than 44,600,000% during the previous year. Obviously, these kind of returns attracted many speculators to this dog-inspired meme token.

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However, looking under the hood, there’s really not much there. Shiba Inu is a project lacking in real-world utility. Outside of crypto exchanges, there aren’t many use cases investors can jump on as reasons to hold this token. Sure, there’s the “Shibarium” and other projects that have been talked about. However, only around 100 vendors globally accept Shiba Inu as payment. Most are relatively unknown, crypto-themed businesses.

Furthermore, this coin does not feature any competitive advantages. It is simply an ERC-20 token with no actual transaction speed or fees that could make it stand out from the crowd.

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Sure, Shiba Inu has a strong community and marketing base. However, I think that right now is not the time to get caught up in the hype. This is certainly among my list of cryptos to avoid right now.

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Dogelon Mars (ELON)

elonSource: Dogelonmars.com

Dogelon Mars (ELON-USD) is yet another meme token crafted following the surge in interest among community-based tokens last year. The relatively short life span of this token in and of itself provides red flags to investors looking at which meme projects have a chance of succeeding long-term.

Like other meme tokens, ELON-USD has seen impressive price volatility over the past year. Another ERC-20 token, Dogelon Mars utilizes the Ethereum (ETH-USD) blockchain for security. And there are applications that can be built using this token. That said, little has been done on this front.

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Dogelon Mars’ ticker, ELON, says just about everything investors need to know about this project. This project aims to be an intergalactic currency, with vague plans to ride along Elon Musk to Mars and beyond. Sounds great, but that’s not necessarily a fundamental reason to hold this token. In fact, I’d go so far as to say this token provides no real-world value outside of its niche community.

Floki Inu (FLOKI)

An image of a corgi wearing a horned viking helmet above text saying Floki Inu on a black background.Source: Zie Project/ShutterStock.com

Floki Inu (FLOKI-USD) is yet another meme coin influenced by the rapid ascent of Shiba Inu. In 2021, Floki Inu saw a surge of approximately 100,000% in the latter-half of the year. However, since then, FLOKI has struggled, alongside its meme coin peers.

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Sure, another rally could be in the cards for Floki Inu or any of these meme coins. However, looking at the fundamentals of this project, there’s little to like other than its very low cost per token and robust presence on Twitter.

This is one of the most volatile tokens in the market, seeing strong momentum pressure in both directions. During good times, this is great. However, during downturns such as the one we’re seeing, this token stands to provide accelerated losses for investors. That’s not something any investor concerned with capital preservation should get excited about.

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One of the notable risks with Floki Inu is this token’s relatively low volume, which is under $20 million at the time of writing. Not a very liquid token, FLOKI’s directional moves could be impacted to a greater degree than its peers, making this token among the riskiest in the market right now.

On the date of publication, Chris MacDonald 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.

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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

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