The meme cryptocurrency market is no stranger to volatility and unpredictability. Still, when it comes to Pepe Coin (PEPE), there’s an additional factor that traders need to be aware of: the concentration of wealth in a few hands. For example, one major Pepe Coin holder possesses over $1 million worth of the token, raising concerns about the stability of the market and the potential risks for traders.
Pepe Coin’s Rapid Rise Attracts Attention
The recent surge of interest in Pepe Coin saw its market capitalization skyrocket from a mere few thousand dollars to over $150 million in days. This frog-themed meme token garnered widespread attention, luring liquidity from traders and spawning numerous copycat tokens across various blockchains.
Despite the hype, Pepe Coin’s liquidity on decentralized exchanges like Uniswap remains limited. With less than $4 million in available liquidity as of Tuesday, a sudden sale by a significant holder could dramatically impact prices.
Trading volumes on centralized exchanges have also swelled, averaging around $300 million daily, but the market’s liquidity remains relatively thin. That could result in a significant price drop if a large holder decides to cash out their holdings.
The Largest Pepe Coin Holder: A Meme Coin Enthusiast
Data from Flipside Crypto, compiled by @deebs_defi, reveals that the largest Pepe Coin holder has over $1.1 million worth of tokens, acquired for just a few hundred dollars’ worth of ether. This wallet also contains $1.1 million in Shiba Inu (SHIB) and $1 million in Floki (FLOKI). That suggests its owner is an avid meme coin trader. The investor also holds $43,000 worth of ether.
While this wallet contains the most substantial Pepe Coin, other top holders may have distributed their holdings across multiple wallets. Data from Lookonchain indicates that five wallets connected to ‘pepecexwallet.eth’ purchased over 8.87 trillion PEPE for a mere $385, later selling the tokens for over $1.23 million.
These sales primarily occurred through Uniswap, with a smaller portion sold on the Huobi crypto exchange.
Crypto analysts on Twitter have pointed out that nearly 3% of Pepe Coin holdings are interconnected, based on data from the wallet analysis tool Bubblemaps. This connection accounts for roughly $3.78 million worth of tokens. Crypto exchanges MEXC Global and Huobi are the largest commercial Pepe Coin holders.
The concentration of Pepe Coin in a few wallets, coupled with limited liquidity, creates a potentially volatile and risky environment for traders.
Those considering investing in meme tokens like Pepe Coin should be aware of these factors and exercise caution in their trading strategies.
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