The market cap of new memecoin Pepe (PEPE) has fallen $1.1 billion from its May 6 peak, though on-chain data shows it’s still being bought by some crypto whales.
In the five days from May 6 to May 10, the price of the memecoin plummeted more than 56%, falling from a peak of $0.00000431 to $0.00000193, according to CoinGecko.
The downward price action of Pepe has seen the token’s total valuation sinking from a peak of $1.82 billion on May 6 to $820 million at the time of publication.
A May 8 report penned by researchers from crypto fintech firm Matrixport attributed Pepe’s sharp decline in price to traders selling large chunks of their holdings to new retail investors following the memecoin’s listing on Binance, the world’s largest crypto exchange by daily trading volume.
Additionally, the report found that the largest driver of Pepe’s meteoric price action since its inception on April 14 seems to be from traders based in Asia. According to Matrixport, buying activity during Asian trading hours contributed a staggering 3,657% to the total 9,071% rally witnessed by the memecoin as of May 8.
Another data point that could provide more validation to the theory is that Ethereum deposits in the 24 hours following the memecoin’s listing on the exchange surged to highs not seen since November 2021.
Crypto market intelligence firm Santiment posited that this was due in large part to early buyers of Pepe securing profits by transferring their holdings — which were mostly purchased by way of ETH swaps on decentralized exchanges like Uniswap and 1inch — back into Ether (ETH).
Updating our report on #Ethereum‘s sky-high active deposits, exchange addresses interacting on the network is now at its highest level since November, 2021. As expected, $ETH is showing decoupling signs and on the cusp of breaking $2k once again. https://t.co/zYjY7669yj https://t.co/dQlKsTVyt2 pic.twitter.com/2nMXOUGgYC
— Santiment (@santimentfeed) May 5, 2023
Despite the steep decline in price over the past week, some of the more well-known and notorious whales in the crypto space are still purchasing Pepe at the subdued price levels.
According to data from blockchain analytics firm Lookonchain, “Machi Big Brother” — the online persona of former tech entrepreneur Jeffrey Huang — has purchased a total of 73.4 ETH of Pepe in the past four days. The Ether was worth roughly $137,000 and the Pepe had an average purchase price of $0.000002082, which rests roughly 3% below the current trading price.
Machi Big Brother bought 6B $PEPE again 30 mins ago.
— Lookonchain (@lookonchain) May 10, 2023
While other memecoins such as Dogecoin (DOGE) and its similarly canine-themed counterpart Shiba Inu (SHIB) have used their material success to build out further applications and use cases for their respective tokens, Pepe seems to be a stab at the idea of providing value at all.
Pepe’s anonymous development team has made it clear that the token is “completely useless,” and the humor of this alone is a good enough reason for investors to “ape” into it. The official website of the frog-themed token features a closing disclaimer that describes the token in the following way:
“$PEPE is a meme coin with no intrinsic value or expectation of financial return. There is no formal team or roadmap. the coin is completely useless and for entertainment purposes only.”