As of May 12, PEPE’s market capitalization was down 65% a week after hitting an all-time high of $1.54 billion.
Profit-taking appears to be the main reason behind the sharp price correction, which went from almost nothing to a peak of $0.00004354 in less than a month of launch. As such, it is considered by many to be the fastest growing ERC-20 token in the history of the cryptocurrency market.
Market value performance of PEPE since its listing | Source: CoinGecko
What is PEPE?
Based on a popular internet meme, Pepe has attracted attention for its imitation memecoin features. The most famous is Dogecoin, which uses the famous Shiba Inu dog meme as its logo.
Pepecoin is based on the “Pepe The Frog” meme tweet created by Matt Furie in the 2005 animated film “Boys Club.”
In 2021, BarnBridge founder Tyler Ward launched a series of low-resolution Pepecoin NFTs that grossed over $60 million on the OpenSea auction platform.
Likewise, the anonymous team behind Pepecoin took advantage of the meme’s current popularity on Twitter.
they did promote Initial acceptance by creating a coordinated meme campaign. At the same time, the media flooded with reports of PEPE investors quickly turning thousands of dollars in investments into millions of dollars within a week, attracting more frenzied participants.
For example, according to CoinCarp.com, the number of PEPE holders went from negligible to over 105,000 in a month.
number number of holders PEPE | Source: CoinCarp.com
But despite these positive price catalysts, Pepecoin still doesn’t have any real use cases for the average person. That’s not the case with Dogecoin, however — the leading memecoin has in recent years been embraced by Elon Musk’s enthusiasm rather than its utility as a token.
PEPE can usurp Dogecoin and What about Shiba Inu?
PEPE currently accounts for only about 5% of Dogecoin’s market cap of over $10 billion. Meanwhile, that accounts for 10% of Shiba Inu’s roughly $5 billion market cap.
Chase Devens, researcher at Messari, debate:
“It would not be surprising to see PEPE surpassing both of these standards at some point, even if only temporarily, and has now reached effectiveness.”
Devens added that the immediate listing on popular centralized exchanges like Binance is the main reason for the rapid growth in value.
For example, SHIB’s first listing on a centralized exchange came more than 260 days after its launch. In contrast, PEPE was listed on a centralized exchange in just 6 days after its launch. Twenty-two days later, the token began trading on Binance, the world’s largest cryptocurrency exchange by volume.
Market value PEPE and SHIB per holder | Source: Messari
“These integrations not only lower the barriers to entry for retail investors to speculate, but also enable large capital providers to offer off-chain market-making services.
PEPE perpetual futures are available on exchanges such as Binance and Bybit, allowing users to use 100x leverage on the PEPE price. In just a few days, PEPE derivatives trading volume surpassed daily spot trading volume. “
The launch of PEPE also coincided with a 100% increase in Uniswap’s daily active users on Ethereum, which currently stands at an all-time high of 90,000 as of May 2021.
Most of these users are involved in trading memecoins, including other newly launched tokens such as WOJAK, TURBO, and AIDOGE.
Uniswap daily active users | Source: Dune Analytics/Messari
Is there more pain ahead for PEPE prices?
However, the excitement and growth sentiment on PEPE right now has parallels to the final phase of the 2021 memecoin bull run.
Notably, PEPE’s short-term rally appears to be the same as DOGE’s bull run on the weekly chart. Moreover, the ongoing correction looks similar to a DOGE drop of over 90% from its all-time high of $0.75 set in May 2021.
PEPE Price Chart 4 Hour and governor weekly | Source: TradingView
In other words, the price of PEPE could extend the ongoing near-term correction to $0.00000083, or 35% below current levels.
Additionally, in the event of a 90% DOGE-like collapse at the top of the market, PEPE would hit $0.00000035, acting as resistance in April 2023.
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As reported by Cointelegraph