Many crypto tokens have recovered this week as investors moved back to risky assets. This surge has brought the cryptocurrency market valuation to nearly $3 trillion. There is a risk that some of these tokens will soon reverse as investors take profits.
Crypto Tokens to Sell as Market Cap Nears $3T
Technicals suggest that the cryptocurrency market may drop soon. That’s because, as shown below, Bitcoin has formed a rising wedge pattern and has struggled to break past $90,000. It has also formed a break-and-retest pattern by moving to $89,300, which was the neckline of the double-top pattern.
If Bitcoin price has a bearish breakdown, there is a risk that most crypto tokens will drop too. Some of the top crypto tokens to sell are Cronos (CRO), Ethena (ENA), and Optimism (OP).
Cronos (CRO)
Cronos is one of the cryptocurrency tokens to sell. The CRO token has surged to $0.1145, up by 55% from its lowest point this month. This surge continued after Trump’s World Liberty Financial reached a deal with Crypto.com.
Still, two risks may push the coin lower. First, there is a likelihood that traders will sell the news since the partnership deal has now been priced in.
Second, Cronos is gearing towards dilution after the community voted to introduce 70 billion new tokens. This significant dilution explains why some crypto players are arguing that Cronos is a scam.
Ethena (ENA)
Ethena is another player in the cryptocurrency market to consider selling. One reason for this is that Trump’s WLFI sold 184k ENA coins, leading to concerns about the coin. This sell-off happened after Amber Group moved ENA tokens worth $10 million to Binance.
The other risk is that Ethena has some parallels to Terra, a company that imploded in 2022. Its biggest asset is the USDe, an algorithmic stablecoin that is not backed by fiat currency. As such, there is a persistent risk that this stablecoin will lose its peg, which may lead to the Ethena price crash. These fears partially explain why the ENA price has crashed by 72% from its all-time high.
Optimism (OP)
Optimism is one of the top crypto tokens to sell. Fundamentally, Optimism has continued to lose market share to other layer-2 networks like Base and Arbitrum. The other reason to sell is that it is highly dilutive, as the network will unlock tokens worth almost $30 million in the last seven days. More unlocks will happen as only 63% of these tokens are in circulation.
Summary on Tokens to Sell as Crypto Market Cap Rises
The ongoing crypto market rebound is a good thing as many longs have made money. However, it is too early to conclude that a bullish breakout has happened. This view will likely be confirmed if Bitcoin rises above $100K and its all-time high. As such, selling some coins like Optimism, Ethena, Cronos seems like a good idea.
The post Should You Sell These 3 Crypto Tokens as Crypto Market Cap Nears $3T appeared first on CoinGape.
