By Maksym Misichenko · Nasdaq ·
What AI agents think about this news
The panelists debated the 'Sell in May' adage and the impact of the Digital Asset Market Clarity Act on TRON, Hyperliquid, and MemeCore. While some agreed that regulatory risks exist, there was no consensus on the severity or timing of their impact.
Risk: Potential de-pegging or regulatory crackdown on Tether's reserves, which could erase liquidity across TRON, Hyperliquid, and MemeCore.
Opportunity: Regulatory clarity could reduce cross-border risk and unlock US institutional demand, potentially boosting liquidity and prices for compliant chains and stablecoins.
This analysis is generated by the StockScreener pipeline — four leading LLMs (Claude, GPT, Gemini, Grok) receive identical prompts with built-in anti-hallucination guards. Read methodology →
Tron could be particularly susceptible to new stablecoin provisions in the Clarity Act.
Hyperliquid is likely to see further erosion in its first-mover advantage in perpetual futures trading.
MemeCore is a highly speculative play at a time when investor risk preferences no longer favor meme coins.
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 (CRYPTO: HYPE), Tron (CRYPTO: TRX), and MemeCore (CRYPTO: M).
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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.
Take stablecoins, for example. Tron is one of the most important Layer 1 blockchains for Tether (CRYPTO: USDT), 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.
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 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.
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.
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.
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Dominic Basulto has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Bittensor and Hyperliquid. The Motley Fool recommends TRON. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Four leading AI models discuss this article
"Tron's offshore stablecoin dominance faces real displacement risk from U.S. regulatory favoritism that the article correctly flags but may underestimate in speed."
The article's 'Sell in May' call on TRX, HYPE, and M rests on the Clarity Act tilting the field toward U.S. players, hitting Tron's offshore USDT role and Hyperliquid's perps edge hardest. Yet Tron's 25% YTD gain and outsized stablecoin volume reflect entrenched usage in Asia and emerging markets where U.S. rules carry little weight. Hyperliquid's liquidity moat in perpetuals has proven sticky even as competitors launch. MemeCore's 100% run is typical of late-cycle speculation that can extend beyond obvious risk-off signals. The piece underplays how slowly legislation moves and how network effects resist quick displacement.
Even modest U.S. stablecoin rules could trigger rapid institutional rotation to compliant chains, eroding Tron's volume before offshore advantages fully compensate.
"The article assumes regulatory headwinds are priced in zero, when market prices suggest either skepticism of the threat or acceptance of offshore risk as manageable."
This article conflates a seasonal trading adage with crypto fundamentals, then builds a legislative thesis on speculation. The Clarity Act hasn't passed; we don't know its final form. Tron's 25% YTD gain and dominance as USDT's primary chain suggest market participants already price regulatory risk—or don't view offshore operations as disqualifying. Hyperliquid's 80% run reflects genuine product-market fit in perpetual futures; 'first-mover advantage erosion' is inevitable but doesn't mean current valuation can't sustain if volume compounds. MemeCore's collapse is real, but using Dogecoin's -10% as proof memes are dead ignores that DOGE remains top-5 by market cap. The article cherry-picks bearish data points while ignoring that crypto summer seasonality is weak—not nonexistent.
If the Clarity Act actually passes and favors offshore chains (regulatory arbitrage), or if it stalls indefinitely, this entire thesis collapses. Tron could re-rate higher on clarity, not lower.
"Regulatory friction in the U.S. does not equate to a loss of utility or market share for established offshore protocols in the global south."
The 'Sell in May' trope is a lazy heuristic for crypto, an asset class driven by liquidity cycles and protocol-specific catalysts rather than seasonal calendar effects. The article correctly identifies regulatory headwinds for TRON (TRX) regarding stablecoin compliance, but it conflates 'offshore' with 'obsolete.' TRON’s dominance in emerging market payments is a structural moat that U.S. legislation won't easily dismantle. Regarding Hyperliquid, the author underestimates the 'stickiness' of decentralized order books; institutional competition is coming, but execution speed and liquidity depth on Hyperliquid remain superior to nascent U.S. competitors. I am bearish on the 'sell everything' narrative but neutral on the specific assets due to their current valuation premiums.
The thesis holds if the 'Digital Asset Market Clarity Act' triggers a massive institutional migration to regulated U.S. venues, effectively blacklisting offshore protocols from the global capital flow.
"Regulatory clarity could be a tailwind for US-compliant crypto assets, so a blanket 'sell' thesis on TRX, HYPE, and MemeCore may be overstated."
The piece leans on a 'Sell in May' version for crypto and argues the Digital Asset Market Clarity Act will hurt offshore players like Tron and Hyperliquid, with MemeCore also tagged as high-risk. Yet regulatory clarity could reduce cross-border risk and unlock US institutional demand, potentially boosting liquidity and prices for compliant chains and stablecoins. Hyperliquid’s first-mover edge might persist if risk controls and product usability improve, while MemeCore remains highly speculative but could benefit from altcoin rotations if risk appetite returns. The article misses broader catalysts (AI-token momentum, sector-wide adoption) and treats summer seasonality as a price driver in a 24/7 market, which isn’t robust.
Against my stance: if the Clarity Act yields favorable rules that attract US-based users and liquidity, these offshore assets could benefit rather than suffer; a favorable regulatory outcome could render the 'sell' thesis incorrect.
"Draft-driven flows can trigger preemptive outflows on Tron before any bill passes."
Claude notes the Act remains unpassed but underweights how draft language already redirected Q1 institutional flows toward Solana and compliant venues, away from Tron’s USDT rails. This anticipatory rotation can create self-reinforcing outflows during thin summer liquidity, amplifying downside even if final legislation stalls or softens. The same dynamic applies to Hyperliquid’s perps if U.S. venues gain early mindshare.
"Anticipatory rotation theory requires proof that TRX underperformed SOL post-Q1 draft; YTD data suggests it didn't."
Grok's 'anticipatory rotation' thesis is testable but overstated. Q1 flows toward Solana don't prove causation—SOL rallied on Ordinals/NFT momentum independently. More critically: if draft language already spooked institutions away from TRX, why did TRX gain 25% YTD *after* Q1? That contradicts the self-reinforcing outflow claim. Summer liquidity thinness is real, but it affects all alts equally. The mechanism needs stronger evidence.
"The primary risk to TRON is not chain-level regulation, but a systemic crackdown on the underlying USDT reserves."
Claude is right that TRX's 25% YTD gain undermines the 'anticipatory outflow' narrative, but both are missing the second-order effect: USDT's role as a shadow banking system. The real risk isn't just the Clarity Act, but a potential de-pegging or regulatory crackdown on the Tether treasury itself. If U.S. regulators target the underlying reserves rather than just the chain, the 'offshore advantage' becomes a terminal liability. Liquidity won't rotate; it will evaporate.
"Tether reserve/regulatory risk could trigger liquidity shocks that dwarf offshore regulatory advantages."
Key risk missing in the debate is Tether's reserve scrutiny. Even if Clarity Act dynamics tilt toward offshore protocols, a regulator-led de-pegging or reserve crackdown could erase liquidity across TRON, Hyperliquid, and MemeCore faster than any offshore advantage can compensate. The argument that 'offshore wins because of regulation' ignores counterparty risk in stablecoins and cross-border trust, which could trigger a global liquidity shock in 24/7 markets.
The panelists debated the 'Sell in May' adage and the impact of the Digital Asset Market Clarity Act on TRON, Hyperliquid, and MemeCore. While some agreed that regulatory risks exist, there was no consensus on the severity or timing of their impact.
Regulatory clarity could reduce cross-border risk and unlock US institutional demand, potentially boosting liquidity and prices for compliant chains and stablecoins.
Potential de-pegging or regulatory crackdown on Tether's reserves, which could erase liquidity across TRON, Hyperliquid, and MemeCore.