Pepe is a meme coin that debuted on crypto markets shortly after mid-April. It is inspired by the very famous meme that has been circulating on the Internet for years now: Pepe the Frog.Â
It should be specified that it has nothing to do with whoever created the meme, since the anthropomorphic Pepe the Frog dates back to a 2005 comic strip, Boy’s Club, written by American Matt Furie. Furie is not involved in the meme coin project in any way, so much so that he even stated recently that he was not even aware of this project.
The issue is precisely about what would bring value to a meme coin that isn’t even connected in any real way to the original meme, other than the fact that it uses it.
Summary
Pepe: the market performance of the Internet meme coin
The initial price at which the PEPE token debuted in the crypto markets, on 18 April 2023, was 0.06 millionths of a dollar.Â
Within just three weeks it made an all-time high at 4.3 millionths. That is, in just a few days it gained 7,000%.
Since then the price has fallen, and has not yet been able to get back to the highs. After falling as low as 1.1 millionths a week after the peak, and as low as 0.8 millionths in mid-June, it began a lateralization between 1.1 and 1.8 millionths that is still ongoing.
Since mid-July, the price of PEPE has fallen almost steadily from nearly 1.8 to just over 1.2 millionths of a dollar.
In other words, those who have not yet sold are in profit only if they bought it before the peak, or after the sharp drop in early June.
Everyone else is at a loss, and since most of the trading was concentrated right around the time of the peak, it is possible to assume that many of those who still have it in their portfolios are currently at a loss.
The drop in volumes
The main problem seems to be precisely the decline in volumes.
Indeed, meme coins such as PEPE perform well in the markets only if they receive a lot of attention, sufficient to generate sustained demand. Instead, after mid-June, volumes literally plummeted, confirming that demand has also plummeted.
The peak in trading volumes occurred on 5 May, when the price hit an all-time high and far exceeded $2 billion in trading.
Five days later daily volume had already fallen below half a billion, and although it then briefly recovered just before the middle of the month, by the end of May it had also fallen below $150 million.
On 22 June it returned to 800 million, but thereafter it literally plummeted. For instance, yesterday it was below 70 million, and even two days earlier it had been only 41 million.
In other words, excluding the peak highs, from an average of about $800 million in May and mid-June, trading volumes have shrunk by more than 90%.
Such a vertical collapse in demand in just a few months casts a deep shadow on the resilience of PEPE’s price.
The forecast
In particular, there are those who argue that the current market capitalization of about $480 million is excessive, and perhaps not sustainable.
The main problem, as is often the case in these cases, is competition.
Indeed, launching a meme coin that merely takes inspiration from a meme is not particularly difficult. You don’t even need to have to involve those who created the meme, so it’s basically a matter of creating a token and growing a community around it.
To clarify, such a community does not necessarily consist of those who use, or like, or follow that meme.
The connection between the token and the meme is purely aesthetic, even though the success of the meme may generate attention toward the meme coin. But it is also not necessarily the case that if the meme is successful, then so is the meme coin.
Moreover, Pepe the Frog is a distinctly dated meme that will inevitably be surpassed by others over time.
Therefore, it is possible that the attention of speculators may shift to other meme coins, as has already happened in recent months.
Since the price of PEPE collapsed in one week from 4.3 to 1.1 millionths of a dollar, other meme coins have also been launched that have been able to attract attention.
At this point, it is hard to imagine how token managers can attract attention to their meme coin, instead of the others that continually debut on the crypto markets.
According to some analysts, if it fails to return solidly above 2 millionths of a dollar, it risks ending up losing even more value, falling below 1 millionth again.
Below that threshold could be the abyss, should it end up there and then fail to rebound, as it did in the second half of July.
Then again, there are plenty of failed, or abandoned, meme coin projects, and even those that have survived through the year, right now do not seem to be doing particularly well.
