On Wall Street, there's a famous adage, "Sell in May and go away." The summer months are typically the slowest months for returns, and that makes May a perfect time to pare down a portfolio.
That same type of thinking applies equally well to the crypto market. With that in mind, it's time to lock in profits on three cryptos up big for the year: Hyperliquid (HYPE +3.87%), Tron (TRX 1.09%), and MemeCore (M +2.36%).
Hyperliquid and Tron
The major catalyst for the summer for the crypto market will be progress on the Digital Asset Market Clarity Act, and I don't see that legislation improving the fortunes of either Hyperliquid or Tron, both of which are cryptos with significant operations abroad. If anything, the Clarity Act will make it easier for U.S. cryptos to compete in key areas.
Image source: Getty Images.
Take stablecoins, for example. Tron is one of the most important Layer 1 blockchains for Tether (USDT +0.01%), the biggest stablecoin in the world. But Tether, just like Tron, is based offshore. An offshore stablecoin running on top of an offshore Layer 1 blockchain just doesn't seem like a winning idea to me, given the overall plan to make America the "crypto capital of the world."
For that reason, sell your Tron and save yourself a big headache. Given that it's up 25% for the year, it's time to lock in profits.
CRYPTO: HYPE
Key Data Points
As for Hyperliquid, up 80% for the year, it's only a matter of time before its first-mover advantage in perpetual futures trading is finally erased. Major U.S. fintech and crypto-native businesses are champing at the bit to get involved here, and the Clarity Act might make it easier for them to finally offer these high-risk products to a wider group of customers.
MemeCore
MemeCore is a Layer 1 blockchain for meme coins. Enough said -- lock in the 100% gain for the year and enjoy the summer. In the current market environment, investors are moving from a risk-on mindset to a risk-off mindset. The last thing they want to do is invest in highly speculative meme coins.
CRYPTO: M
Key Data Points
Case in point: Just look at how badly top meme coins are performing this year. Dogecoin is down 10%, Shiba Inu is off 17%, and the Official Trump meme coin has lost 57%. I just can't think of any reason to get involved with meme coins right now.
What to hold on to during the summer
That being said, investors shouldn't dump all coins that are up big for the year. There's still room to run for Bittensor, an AI crypto. As long as the AI investment thesis is going strong, it's likely that money will continue to pour into the crypto. For the year, it's up nearly 20%.
That being said, May is a perfect time to lock in your gains for the year. If a cryptocurrency isn't going to be positively impacted by the new Clarity Act, then it's time to offload it before the start of summer. As they say, sell in May, and go away.
