3 Cryptos That Are About to Get Absolutely Crushed

Over the past ten years, the cryptocurrency space has undergone enormous development. With investors ringing in a new year, there are plenty of new catalysts to be priced in, with a fresh perspective used by many. Accordingly, it’s perhaps unsurprising to see so many cryptos outperform to start this year given how poor 2022 has been for blockchain enthusiasts.

Unfortunately, it appears many of the headwinds that plagued the market last year remain. The impact of the FTX fallout and other systemic failures is being felt across the sector. Thus, while FTX may come back in some form or fashion, it’s unclear how many more centralized or decentralized exchanges may fall amid a token price rout that seems to remain entrenched.

Additionally, many of the same macro headwinds that took risk assets lower last year are still at play. Inflation is still high, with interest rates expected to rise and stay elevated for the remainder of the year. For high-growth assets such as crypto, this has provided valuation compression. And while we may be nearing the end of this hiking cycle, it’s unclear how much of this headwind is currently priced in.

With this backdrop, many investors may be looking for cryptos to sell. Here are three tokens I think should be put in this bucket right now.

Expanse (EXP-USD)

A blockchain-based gaming crypto, Expanse (EXP-USD) has been among the more volatile tokens in this market. Some investors were intrigued by the recent announcement that Expanse Studios had its games successfully included in Blue Ocean’s casino aggregation platform GameHub. But this provider of online video slots has seen less growth than many expected. That’s despite this crypto project’s considerable market position in the gaming sector.

Indeed, among the higher-growth areas of the market, gambling is one space crypto has thrived. As a means of skirting regulations, certain projects have seen outsized growth relative to their peers. Expanse is one such crypto that has garnered attention of late for this reason.

But with increasing regulatory scrutiny coming to crypto, there’s reason to be concerned. This is on my list of cryptos to sell for the simple reason that regulation won’t escape the crypto space for much longer. Those looking for growth may have to look to more conventional companies in the gaming space.

PotCoin (POT-USD)

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As its name suggests, PotCoin (POT-USD) is a cannabis-themed crypto project. Interestingly, this project also includes a metaverse component, which has led to a double-whammy of growth catalysts for investors.

Indeed, what’s not to like about a crypto that encompasses both marijuana and the metaverse? This cryptos goal is simple: to build a virtual world for cannabis fans. As such, a custom pipe manufacturer launched tokenized bongs in January 2022, and celebrities like Snoop Dogg bought up the non-fungible tokens (NFTs).

Initiatives like CannabisCoin (CANN-USD) and PotCoin tried to offer a digital currency custom-made for the sector around 2014, but they never truly took off.

One of the first digital currencies of its kind, PotCoin debuted in January 2014 and now trades for less than one cent. Since it has been in use for more than eight and a half years, dispensaries, farmers and consumers have all expected significant growth as a result of partnering with this project. Unfortunately, such growth hasn’t really materialized.

Thus, this token appears to be a better concept than utility token. I’d steer clear of this speculative option right now.

GameCredits (GAME-USD)

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Another gaming token, GameCredits (GAME-USD) is aimed at video game enthusiasts over the gambler. However, this token is just as speculative as the other names on this list.

The key problem GameCredits has set out to solve is the gaming industry’s payment system. GameCredits has looked to use cutting-edge payment solutions to make crypto technology available to the broader gaming industry.

Sounds good. Indeed, GameCredits has seen some interesting developments of late. These include the development of a new payment gateway.

However, this project’s volatility has been notable. Relative to other tokens in this space, I think GAME is one token that could see more significant downside from here if crypto winter drags on. Thus, for those looking to take a more defensive posture, this is one project to steer clear of 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.