Warning Signs for Cryptocurrency Investors: The Reality of Extreme Volatility and Investment Risks


The cryptocurrency market has recently exhibited extreme volatility, presenting significant risks to investors. After Bitcoin reached an all-time high of $109,100 earlier this year, it has since fallen to the $84,000 level, representing nearly a 25% value fluctuation in a short period. In this market environment, experts are warning about investment risks, particularly regarding certain altcoins.

5 High-Risk Altcoins Experts Recommend Selling

Recent cryptocurrency media outlets have highlighted five altcoins that investors should consider selling before the end of March, based on expert analysis. These coins are deemed to have high risk of further decline due to continuous price drops, internal issues, and project vulnerabilities.

1. Shiba Inu (SHIB)

  • Current Situation: Trading at $0.00001279, down over 85% from its all-time high
  • Risk Factors: Continuous decline over four years since the 2021 meme coin craze, failure to secure real utility
  • Expert Opinion: A coin relying solely on popularity, lacking ability to create long-term value

2. Hamster Coin (HMSTR)

  • Current Situation: Recorded $0.002141, down more than 80% since its 2024 launch
  • Risk Factors: Telegram mini-game-based token that failed to maintain price after initial popularity
  • Expert Opinion: Continued clear downward trend makes this a burdensome coin to hold

3. Official Trump Coin (TRUMP)

  • Current Situation: Trading at $12.03, down 84% from its peak
  • Risk Factors: Insider trading suspicions, ongoing controversy about cryptocurrency issued by the US president
  • Expert Opinion: Selling pressure from major investors and political controversy could lead to additional declines

4. FTX Coin (FTT)

  • Current Situation: Trading at $0.00006299, effectively a 100% loss from its all-time high
  • Risk Factors: Failed to restore trust after the FTX exchange collapse, additional token distribution planned
  • Expert Opinion: Concerns about increased volatility due to additional token circulation

5. Hyperliquid (HYPE)

  • Current Situation: Trading at $14.65, down 40% over one month
  • Risk Factors: $4 million loss due to Ethereum whale liquidity issues, exposed platform vulnerabilities
  • Expert Opinion: High possibility of further value decline as internal problems coincide with market downtrend

Key Risk Factors Cryptocurrency Investors Should Remember

1. Extreme Volatility

Cryptocurrencies exhibit significantly higher price volatility compared to traditional assets. Double-digit fluctuations within a single day are common, meaning a substantial portion of investment funds can evaporate in a short period.

2. Regulatory Uncertainty

Governments and regulatory bodies worldwide are trending toward strengthening cryptocurrency regulations. Unexpected regulatory announcements can have a dramatic impact on the entire market.

3. Project Failure Risk

Many altcoins are launched riding on short-term popularity without long-term vision or substantial technological value. Such projects often rapidly lose value once initial interest wanes.

4. Hacking and Security Risks

Crypto exchanges or the projects themselves continue to experience hacking incidents, which can have fatal impacts on the value of related coins.

5. Liquidity Risk

Some smaller altcoins have low trading volumes, making it difficult to sell at an appropriate price when desired, which can amplify losses, especially in a bear market.

Advice for Investors

  1. Diversify Investments: Don't invest all funds in a single coin; diversify your portfolio.
  2. Risk Management: Invest only what you can afford to lose and establish a stop-loss strategy in advance.
  3. Project Research: Thoroughly investigate the coin's technological value, team background, and roadmap before investing.
  4. Long-term Perspective: Focus on long-term value rather than being swayed by short-term price movements.
  5. Resist FOMO: Avoid rushing into decisions because "everyone else is doing it" or fear of missing out.

Conclusion

The cryptocurrency market remains an evolving new asset class, carrying substantial risks alongside high profit potential. Coins like the five altcoins mentioned above, which have weak technological foundations, ongoing controversies, or continuous downward trends, require especially cautious approaches. Investors should make investment decisions based on sufficient information and cool judgment, minimizing emotional decisions in this highly volatile market.

Cryptocurrency investment should be undertaken under personal responsibility, and seeking expert advice before making investment decisions is also a good approach.

Popular posts from this blog

SCHD 2025 Rebalancing Analysis: Shifts Towards Energy and Defensive Sectors

The Schwab U.S. Dividend Equity ETF (SCHD) has undergone its latest rebalancing, making significant adjustments to its portfolio composition. These changes reflect the fund's strategic response to current market conditions and economic uncertainties. Let's dive into the details of this rebalancing and what it means for investors. Previous SCHD Composition Before the rebalancing, SCHD's top holdings included: ABBVIE INC (ABBV): 4.96% AMGEN INC (AMGN): 4.68% COCA-COLA (KO): 4.59% PFIZER INC (PFE): 4.28% CHEVRON CORP (CVX): 4.27% VERIZON COMMUNICATIONS INC (VZ): 4.26% BRISTOL MYERS SQUIBB (BMY): 4.25% CISCO SYSTEMS INC (CSCO): 4.23% PEPSICO INC (PEP): 3.81% TEXAS INSTRUMENT INC (TXN): 3.81% BLACKROCK INC (BLK): 3.81% In the financial sector, besides BlackRock, SCHD included several banking stocks such as US Bancorp (2.54%), M&T Bank (1.13%), Fifth Third Bancorp (1.03%), and Huntington Bancshares (0.83%). Rebalancing Summary Removed Stocks The following stocks w...
Read more

U.S. Semiconductor Tariff Exemptions: Critical Analysis of Executive Orders 14257 & 14259 (April 2025)

Image
In the midst of escalating global trade tensions, the United States has introduced significant tariff policies through Executive Orders 14257 and 14259, with special provisions for semiconductors that could reshape global supply chains and trade relationships. This analysis examines the key exemptions for the semiconductor industry and their broader implications. 1. Executive Order Framework and Timeline Executive Order 14257 (signed April 2, 2025) established the foundation of the "Reciprocal Tariffs" policy with a 10% base tariff on all imported goods, plus additional tariffs of up to 50% for 57 countries. Notably, it included specific carve-outs for critical technological components including semiconductors. Executive Order 14259 (implemented April 8-9, 2025) provided crucial clarifications on exemption categories and updated reporting requirements. This order specifically addressed semiconductors, computer components, and telecommunications equipment, establishing t...
Read more

SPDR Bridgewater All Weather ETF (ALLW) Launch: Innovation or Strategy Limitation?

Bridgewater Associates, the world's largest hedge fund, and State Street Global Advisors, a major U.S. asset management firm, launched the 'SPDR Bridgewater All Weather' ETF (ticker: ALLW) on March 6, 2025. This collaboration has generated significant buzz in the investment industry, though perspectives on this strategy remain divided. Let's explore the implications of this landmark ETF launch and what it means for investors seeking all-weather portfolio solutions in today's increasingly complex financial landscape. The Core and History of the All Weather Strategy After founding Bridgewater in 1975, "Wall Street guru" Ray Dalio developed the 'All Weather' investment strategy with the goal of preserving and growing assets in any economic environment. This strategy is characterized by building a portfolio designed to withstand four major economic scenarios: inflation, deflation, recession, and economic boom. Dalio's approach was revolutionary...
Read more