Pepe Coin is the newest meme coin to grace the top 100 cryptocurrencies, with an all-time high valuation of $1.6 billion. Over the past few weeks, it has seen explosive growth, making it the first meme cryptocurrency to explode during a bear market and the fastest to reach a $1 billion market cap. Is PEPE sustainable with the potential to overtake Dogecoin, or is it simply a fad that will be forgotten in the next bull market? Let’s find out.
Pepe Coin was launched by an anonymous team on April 17, 2023, with a total supply of 420.69 trillion coins on the Ethereum blockchain. It is based on the controversial Pepe the Frog meme, created by Matt Furie in 2005 — though the artist has no association with the cryptocurrency. Upon release, there was no apparent presale or tax. Immediately, the coin gained traction online, with supporters sharing the phrase “Pump the frog!” Since launch, the price has increased by 6800%, making it one of if not the best performers of the past month and possibly the bear market in general.
Pepe Coin quickly caught fire and garnered hype across the internet. A few weeks after launch, it was already listed on crypto.com and Binance, two top-tier exchanges, and PEPE volume was reaching $2 billion per day. For crypto veterans, PEPE felt like another Dogecoin or Shiba Inu: a meme coin with no fundamental value pumping based solely on the actions of its community and a herd mentality of buying and holding.
Whether or not the PEPE hype will continue to climb until it overtakes Dogecoin or Shiba Inu is the ultimate question, however, it does not seem like this will be the case. Even though Dogecoin has many issues related to its inflationary supply, it is an established meme coin with support from big names like Elon Musk and a history of surviving multiple bear markets. Similarly, Shiba Inu, while still relatively new compared to DOGE, has done a decent job of surviving the bear market, and the team has been developing new use cases for the token, even though most of these use cases are simple and likely bring little to no value to SHIB. PEPE does not have any use case. Additionally, the Pepe the Frog meme is more obscure than a dog-based meme and has some added controversy since Pepe has previously been adopted as a mascot by alt-right movements.
Like any meme coin, buying PEPE is much closer to gambling than investing. The entire value proposition of PEPE is that its community will continue to shill the token and bring in new buyers, which will drive up the price. There is an extreme amount of volatility with any meme coin, much less those that are incredibly trendy, and it would not be surprising to see PEPE rise or fall by more than 30% in a day. Moreover, even Dogecoin is down 90% from its all-time high, and SHIB is also. Gambling with memecoins is about timing the market correctly and not based on any sort of fundamentals.
Even though PEPE is one of the most popular and talked about cryptocurrencies, it will likely not stay that way for long. Pepe the Frog’s relative obscurity compared to Doge, as well as its controversial history, do not make it likely to be covered or adopted like Dogecoin was. Additionally, while true for all meme coins, the lack of utility provides no price floor or stability. The Pepe Coin community could help it recover to new all-time highs, but there is no way to know. This is the danger with meme coins and why it is critical to treat them as gambling instead of investing.
By Lincoln Murr