Pepe (PEPE), touted as the biggest new memecoin of 2023, recently encountered a devastating setback. The project’s anonymous developers shockingly sold approximately $16 million worth of the token on Aug. 24, resulting in a partial rug pull. The sudden sell-off caused Pepe’s price to plummet by as much as 26%, leaving crypto investors and memecoin enthusiasts bewildered about the token’s future.
Potential Positivity and Minimal Long-Term Impact
Although the manner in which the developers sold their tokens was far from ideal, crypto trader Reetika Trades sees potential positivity for PEPE. Reetika believes that the event will ultimately have “negligible effects” on the token’s long-term outlook. In her view, Pepe’s lack of utility and fundamental worthlessness makes the departure of a few developers irrelevant to the token’s overall performance. Moreover, the substantial sell-off reduces the risk of future massive dumps by the developers, which could be healthier for the token’s stability in the long run.
It is important to note that Pepe is a memecoin that openly acknowledges its lack of underlying value. The price of memecoins, including Pepe, is highly susceptible to extreme volatility, akin to gambling rather than traditional investing. However, pseudonymous trader Horse suggests that removing the remaining supply of tokens from the developers’ hands could be beneficial in the long term, especially if Pepe aims to emulate the success of Dogecoin (DOGE). Horse expresses optimism, stating, “I think [Pepe] will make a comeback.”
The Resilience of Pepe’s Liquidity and Kaiko’s Perspective
Crypto data provider Kaiko’s report affirms that despite the sudden crash in price, Pepe’s liquidity surprisingly remained intact. The researchers conclude that the potential abandonment of the project by the team does not necessarily spell its demise. This observation aligns with the sentiments echoed by Reetika Trades and Horse. While the situation undoubtedly poses challenges for Pepe, it is far from irreparable.
Analysts from Santiment caution traders to expect “higher volatility” in the wake of Pepe’s rug pull. Despite becoming the top trending cryptocurrency following the allegations, the future of Pepe remains uncertain. Prominent trader Kaleo expresses his bearish stance on the token, openly hoping for its total collapse. Kaleo states his intention to remain on the sidelines, noting that Pepe might rally to new highs to spite him for taking a moral high ground.
The Birth of a New Pepe: A Glimmer of Hope?
Interestingly, the turmoil surrounding Pepe prompted an anonymous team to create a spin-off of the original token. This new PEPE token claims to be free from the issues that plagued its predecessor. The project team emphasizes its commitment to decentralized finance and describes the new Pepe token as the “true essence” of the concept. As Pepe battles to regain its lost momentum, this spin-off offers a glimmer of hope for the community.
The rug pull experienced by Pepe dealt a severe blow to the memecoin’s reputation and price. Despite the setback, there are contrasting perspectives on the token’s future. While some believe that Pepe’s inherent volatility and fundamental worthlessness make a strong recovery unlikely, others see potential for a comeback. Only time will reveal whether Pepe can defy the odds and emerge stronger from this challenging chapter.