7,000% Jump In Value Of Memecoin Pepe Which Is Based On A Frog

“Memecoins,” a hyper-speculative, ultra-volatile, and somewhat strange class of cryptocurrency, are back in the spotlight after the latest digital token skyrocketed in value.

According to data tracker CoinGecko, Pepe, a coin inspired by an anthropomorphized frog popular in online memes, jumped about 7,000% in the 17 days following its April 16 introduction, reaching a market value of $1.8 billion by May 5.

Pepe’s surge has rekindled investor interest in memecoins as a whole, with overall trade volumes increasing to $2.6 billion in the first week of May from $408,000 the previous week, according to Dune Analytics data.

“Memecoins just flare up on occasion, and it’d historically happened when the market’s a bit choppy or sideways,” said Todd Groth, head of index research at CoinDesk Indices. “It’s almost like, if the market is not moving up fast enough, traders find these smaller tokens to trade with.”

The current memecoin mania comes as bitcoin’s 2023 climb comes to a halt. Since mid-April, the top cryptocurrency has dropped 6% to $27,416.

Pepe, which trades in fractions of a cent, was down 60% from its May 5 high on Monday, but it still has a market valuation of about $740 million. This places it third in the market after dogecoin and shiba inu, which were both born as internet jokes referencing a Japanese dog breed and command more than $10 billion and $5 billion, respectively.

Memecoins originally came to public attention during the 2021 “Wall Street Bets” movement, which was fueled by retail traders.

They have no practical utility other than speculation, which distinguishes them from more “mainstream” coins such as bitcoin and ether, which supporters claim have promise as a means of payment or a store of value.

Market participants cautioned that memecoins might cause serious problems for dealers and investors.

“Human beings love to speculate,” said Martin Leinweber, product strategist at MarketVector Indexes. “I would still be very cautious to buy them. It’s gambling in its purest form.”

Since its release in April, the currency associated with Pepe the frog has risen to the top of the list of meme coins in terms of market value. In terms of daily trade volumes, it has likewise risen to the top of the list.

Since its release in April, the currency associated with Pepe the frog has risen to the top of the list of meme coins in terms of market value. In terms of daily trade volumes, it has likewise risen to the top of the list.

According to the website, Pepe was created “for the people” with “no formal team or road map” and is “completely useless and for entertainment purposes only.”

According to statistics firm Messari, the coin is the fastest-growing cryptocurrency hosted on Ethereum, the second-largest blockchain.

According to Chase Devens, analyst at Messari, the spike in pepe’s popularity was fueled by its swift listing on major centralised exchanges, including top platform Binance.

Binance claims that pepe has “no utility” or “value support mechanism” on its website. It warns users about the volatility of pepe and states that the site “will not be responsible for your trading losses.” Binance did not reply quickly to a request for comment on Pepe’s leap.

The centralised listings also allowed for derivative trading for pepe, with leveraged exposures and volatility driving up Ethereum transaction fees, according to Devens.

Memecoin fortunes, like those of other crypto currencies, are founded in retail trading and frequently propelled by internet sentiment.

Dogecoin and Shiba Inu, the eighth and fifteenth largest cryptocurrencies, are prone to extreme price volatility.

Dogecoin was founded in 2013 and skyrocketed more than 12,000% to an all-time high in May 2021 before plummeting about 90% since then. Shiba inu has also plunged 90% from its peak in October 2021. learn more

According to CoinGecko data, newcomer pepe has over 100,000 holders.

The rise of memecoin is “an intriguing phenomenon,” according to Edmond Goh, head of trading at crypto liquidity service B2C2.

“The latest coin explosion illustrates that there is still capital sitting on the sidelines waiting to be deployed.”

(Adapted from Reuters.com)


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