Why Dollar Overhang Is the First Thing I Check
These are the top 20 most dangerous altcoins in the top 100 in terms of token dumpage. This is the number one thing you should look at immediately when researching a project: how many of the tokens, how many dollars worth of the coins, are sitting there in the fully diluted market cap compared to the tradable market cap. I call this dollar overhang. This means the amount of tokens that aren't actually tradable that are going to be unlocked and given, usually, to insiders. This is a huge risk factor, because that means you're trading on an artificially small supply, and you have to consider what happens if these tokens come unlocked and are sold — how much that's going to crush the existing price. Out of the top 100, XRP and Hyperliquid have the absolute worst statistics. Now, I'm not a financial advisor and this isn't financial advice — this is my opinion, and to me this is one of the most important metrics you should check.
If you don't understand why this is such a big problem, let's picture a scenario where I launch my own meme coin and I call it Jerry Banfield Crypto or whatever. I have a trillion tokens, but I only sell one of those tokens. This is an extreme example, but if I sold one of those trillion tokens, or perhaps I sold two of them for a dollar each, then technically my market cap would be $2 in that example. But my fully diluted market cap in that example would be $2 trillion — in other words, the price of all the tokens at the current token price. So it's a huge red flag when you see this huge difference between what the total available trading market cap is versus the actual fully diluted. Technically, anyone could make a meme coin with a trillion token supply and sell two or three of them for a dollar, and technically you would have a bigger market cap than Bitcoin. But you see what a problem that is. You see how fake that is — that's not real, because you're holding the vast majority of the tokens and not selling them. That's what fully diluted market cap shows: that the real market cap — the circulating supply people are trading — is artificial, and therefore the price is artificially high, because there's a huge amount of tokens that are not actually tradable. Does that make sense? This is why it's a huge problem.
The Two Worst Offenders: Hyperliquid and XRP
Hyperliquid right now is, in my opinion, the biggest danger, with the market cap being $13 billion but the fully diluted being $58 billion. That's $45 billion, with the vast majority still outside circulation.
And XRP — huge, still, after all this time. XRP has $43 billion in tokens that are not publicly tradable. And Ripple gets something like hundreds of millions of dollars worth of them every few months. You can look up the exact amount, but they get a ton of tokens constantly, just given to them. And then where do those go? They can just sit there, they can be put back in, or they can be sold and dump the price. Usually, the longer projects are around, the less token dumpage — the smaller the difference between the market cap and the fully diluted. Now yes, you can have tokens with infinite supply that can potentially create more, but the fully diluted difference from the regular market cap is often a much bigger risk factor. That means there's a whole bunch more hidden inflation that's not visible, at least to the majority of people simply looking on market pages and not paying attention to this number.
So Hyperliquid and XRP are the absolute worst two for this. But I'll go down the rest of these, because to me one of the biggest red flags is holding a coin where there's a huge difference between the tradable market cap and the fully diluted. That indicates to me there's an artificially inflated price that is at a high risk of dumping when those tokens come out.
The Rest of the Top 20
WhiteBIT Coin, or WBT — also a huge $10 billion overhang, in a coin hardly anybody has even heard of or is talking about. Huge red flag. RAIN has $6.5 billion. And note the total percentages of the supply: ideally, the gap between your circulating supply — the actual amount tradable or available to be held by regular people — and the fully diluted would be close to zero. The still-outside-circulation number would be close to zero. The closer it is to 100, the bigger the red flag; the closer it is to zero, the better. But you also have to consider the raw amount of dollars. XRP is 37% still outside circulation, which is much better than Hyperliquid, but the $43 billion value is a huge problem. Then you look at WhiteBIT: 60% outside of circulation. RAIN: almost 40% outside circulation, $6 billion.
ADI: almost $6 billion outside circulation — and look at this one, 87% of the coins still outside circulation. MemeCore: 75% outside circulation, over $4 billion for a meme coin layer one — huge red flag. SUI: massive token unlocks coming for SUI, still almost 60% of the tokens outside of the circulating supply, $4.5 billion at the current price that could be dumped. World Liberty Financial: almost $4 billion, still two thirds not even circulating yet. And Toncoin, the coin previously known as Gram: still almost half of it not even circulating yet — not even out there yet — and you're looking at billions and billions of dollars. Aster: $3 billion left, the majority of the tokens not in circulation. Stellar XLM, as old as it is, same model as XRP: you still have 30% of the tokens, $3 billion in Stellar. Cronos CRO: $3 billion. Stable: $2.7 billion. Worldcoin: $2.4 billion — I expressed concerns over the token unlocks years ago, and it's still a huge concern.
Bittensor TAO — for all the hype about this, there's still $2 billion, half the circulating supply, that are not unlocked, and that's what's incentivizing this whole thing right now. That, in my opinion, is what's propping up this entire Bittensor TAO narrative and all the subnets: all these TAO tokens getting unlocked and handed out for what, to me, does not look like truly productive work. Well, I guess I need to take them potatoes out of the oven. Chainlink, as old as it is, still has $2 billion sitting there in a position to be dumped on retail. Ondo: over 50% still sitting there, $2 billion. Ethena: almost $2 billion, 69% of the supply still not unlocked. Then you have Lighter and Gate, which also have billions of dollars.
Key Findings and My Take
Now, some key findings. Hyperliquid is clearly the largest danger out of all of this, in my opinion, and I've said this over and over again because I love you guys and I don't want to see you get wrecked by what to me is an obvious problem: this huge amount of tokens that almost nobody even notices. XRP is also very dangerous, as I've continued to point out. There's basically indefinite token dumpage with huge amounts of money. You have to have endless XRP hype just to keep the price even — intentional, huge market manipulation, doing anything it takes to try and just keep the XRP price up so that all those insider tokens can be dumped.
By percentage — like that example I gave before about how you can make a meme coin bigger than Bitcoin — the market cap websites like CoinMarketCap would not list that coin at the top, because they list by circulating supply to help people see through it. Otherwise anyone could just create a coin and it'd be up there above Bitcoin. And that's why some of these coins are sneaky: you don't realize how much money is in there, how much of the extra token supply is held. You can see ADI is even worse than Hyperliquid by percentage, but it doesn't have as much in terms of dollars. This means these coins are extremely dependent on flywheel marketing. If they can't keep the price up and the token price dumps, then you're looking at a negative feedback cycle where the dumping price and the token unlocks create further dumping, and you could just go down crazy amounts. And you have to get so many people to buy these just to keep the price up.
That said, outside circulation does not automatically mean it's all going to be dumped at once. But it does mean the team and investors still have a lot of tokens that they can't sell yet that they will be able to sell later. These are foundation or ecosystem treasuries, incentives, validator or mining emissions, or tokens scheduled for release. What it means, though, is that a better situation would be to be in a coin where this isn't an issue. Like with ICP: all the token unlocks have already happened — like 99% of them have already happened. So with ICP you've got an organic environment, which to me means you don't have this problem. And even the best technology in crypto, ICP, having all those billions of dollars of unlocks in the first few years — that contributed to crashing the price, even with the best tech in crypto and the maximum possible hype.
So I encourage you, if you're holding any of these, to research deeper and deeper. Because do you think these coins can withstand all the token dumpage that can potentially come? And is there any realistic chance of surviving all that token dumpage and then having any positive expectations beyond tiny incremental gains over the next few years? I personally don't think so. For more breakdowns like this one, you can watch my Crypto Reviews playlist.
If you'd like to talk crypto with me and go over your whole portfolio and look at things much deeper — or talk anything else — I'm here to listen. I'm here to get to know you. You can schedule a call with me, and if you want to debate a coin with me or film a video about that, I'm available for a debate anytime. Just text me after you get the phone number on the confirmation page that you want to record a video and do a debate, and I'll be ready to go on any coin.
And if this is helpful, I have my Jerry Banfield ICP channel where I talk about ICP. Appreciate you watching.