What happened?
The price of Pepe (PEPE), a meme coin, has decreased by 3.3% over the past week amidst a widespread downturn affecting such coins. Whales, or large cryptocurrency holders, appear to be selling off their PEPE holdings, as indicated by a 7% decrease in “in the money” wallets and a reduction in large transaction volumes by 5%. Additionally, the MVRV Z-score, which tracks wallets holding PEPE that are underwater, has turned negative and continues to decline.
Who does this affect?
This situation primarily affects investors and holders of PEPE, especially those who have recently purchased tokens and are now seeing their investment’s value decrease. Whales, who hold significant quantities of the token, are also notably impacted as they seem to be incurring losses while reducing their holdings. Moreover, potential new investors in the crypto market may be cautious due to the current negative sentiment surrounding meme coins like PEPE.
Why does this matter?
The decline in PEPE’s price illustrates the volatile nature of meme coins, impacting market confidence and signaling potential risks for traders and investors engaged in speculative assets. This trend may lead to reduced market liquidity if whales continue to exit, potentially causing further price drops. However, for contrarian investors, this dip could present an opportunity to accumulate PEPE at lower prices, depending on future developments and market sentiment.