The Pepe cryptocurrency made huge waves in the spring of 2023, when it suddenly bursted onto the scene with a huge price rally. Pepe single-handedly revitalized the meme coin sector and brought some serious gains for its early buyers.
However, the Pepe coin price has entered a significant downtrend, crashing more than 75% since its all-time high.
Will Pepe coin recover back to its all-time highs and possibly above? In this article, we’ll be exploring both the positive and negative factors that could affect PEPE moving forward.
PEPE’s price crash
PEPE’s price action hasn’t been too exciting since it got listed on major cryptocurrency exchanges like Binance, KuCoin, OKX and Kraken. While these listings led to a huge price spike initially, they also marked the top of the huge rally that made Pepe a household name in the crypto community.
At the time of writing, PEPE is posting a -44% price change in the last month. In the same time period, Bitcoin has dropped by 2.9% while Ethereum has gained a modest 0.15%.
This sharp correction in the PEPE markets was bound to happen eventually since the coin increased from a market cap of practically zero to a market cap valuation of over $1 billion in the space of less than a month.
Of course, it remains to be seen just how deep this price correction will go, as we’ve yet to see a major bounce in the PEPE market that would confirm the token has bottomed out.
Now, let’s take a look at the most important trends and developments that could impact the price of Pepe and its chances of recovering.
The PEPE token is almost entirely fueled by speculation
Pepe is a prototypical example of a meme coin. While some projects with this label have tried to attach some utility to their tokens, the Pepe project doesn’t have any lofty ambitions and is perhaps most similar to Dogecoin, the original meme coin. On their website, the Pepe team even says that the coin is “completely useless and for entertainment purposes only”.
While there is a roadmap on the Pepe project’s website, it doesn’t provide much detailed information and contains targets like “Pepe Academy” and “Pepe Tools” which the team doesn’t elaborate on at all.
Right now, there doesn’t appear to be any indications that Pepe is planning to transform into a “serious” crypto project. Most likely, it will just remain a simple meme token that will rise fall depending on how much hype its community manages to spin up around it.
Buying PEPE is more like a gamble than a serious investment. If you have a low risk tolerance, it’s better to stay away from such projects since their price movements are entirely based on speculation and market sentiment, which can turn on a whim.
The lack of any fundamentals or use case makes it very difficult to say if Pepe will recover or not.
Regulatory crackdown on crypto exchanges
Recently, we’ve seen U.S. securities regulator SEC (Securities and Exchange Commission) bring lawsuits against Binance and Coinbase, which are two of the largest exchanges in the cryptocurrency industry.
While the contents of both lawsuits are different, the common thread between the two is that the SEC is alleging that both Binance and Coinbase list crypto assets which are allegedly unregistered securities.
To be fair, most people who are interested in PEPE probably don’t care too much about regulations. After all, PEPE can easily be traded on decentralized exchange protocols like Uniswap, which operate through smart contracts on the Ethereum blockchain and can’t realistically be shut down by anyone.
However, decentralized exchanges on Ethereum are more expensive to use, and offer a slightly worse user experience compared to their centralized counterparts. If centralized exchanges become much more strict about which assets they’re listing, Pepe could see some delistings, which would limit the number of people that would be likely to buy the token.
While the SEC has sued cryptocurrency exchanges before, this is the first time they’re suing the biggest players in the crypto industry. Depending on the results of the lawsuits, we could see a negative impact on cryptocurrency more broadly.
The United States is one of the world’s most lucrative markets, and if crypto exchanges operating there can’t offer the majority of cryptocurrencies for trading because they might be considered securities, we could see the amount of capital entering the crypto market shrink significantly. This chilling effect could have a negative impact on practically all crypto assets, even meme coins like Pepe.
The flood of new meme tokens might be limiting Pepe’s growth potential
Pepe’s incredible rally in April and May resulted in a wave of new meme coins that attempted to capitalize on PEPE’s momentum. Some projects are more or less trying to copy Pepe, while others are placing their bets on other popular internet memes.
This huge influx of new meme coins and tokens might be diluting the amount of capital that’s flowing into PEPE. After all, Pepe has already grown in value significantly, which is leading many people who are trying to make profits on meme coins to buy smaller meme coins instead due to their higher potential upside.
Here, the Pepe project’s low-effort approach might be a double-edged sword. Anyone that can spin up a new meme token smart contract within minutes and create a website can practically match the Pepe project’s fundamentals. Of course, the difficult part is to attract a large following, which is what the Pepe project has done successfully and what most other freshly-launched meme tokens fail to accomplish.
How high could Pepe go? Pepe price prediction
Currently, the Pepe price prediction on CoinCodex is forecasting a bullish period ahead in the Pepe markets.
We need to point out that it’s currently very difficult to predict where the price of PEPE could go in the future. This is because of two main factors – PEPE has a very short price history, and it has been extremely volatile in its time on the market so far.
Based on search engine trends, quite a few users are wondering if Pepe will reach $1. This is practically impossible, as it would imply a market capitalization of $420.69 trillion due to the supply of PEPE being 420.69 trillion tokens. For reference – Apple, the most valuable company in the world, has a market cap of $2.84 trillion at the time of writing.
In fact, it’s even extremely unlikely that Pepe will reach $0.01. This would imply a market cap of $4.2 trillion for Pepe, which would still be larger than Apple’s current market capitalization. It would even be larger than the biggest market cap ever achieved by the cryptocurrency market as a whole (about $2.9 trillion).
While the price of one PEPE token seems small, you have to keep in mind that its supply is truly massive when trying to find realistic price targets.
The bottom line – can Pepe go back up?
It’s certainly possible that Pepe can go back up. After all, similar meme coins such as Dogecoin and Shiba Inu have reached valuations much higher than Pepe has at its current peak. Still, we need to keep in mind that DOGE and SHIB made the majority of their gains in 2021, when the cryptocurrency market as a whole was extremely bullish.
Meanwhile, Pepe has entered the scene during a crypto market that’s ambiguous at best and bearish at worst, so its upside could be more limited.
If Pepe coin will bounce back, we’d likely have to see an overall bullish turn in the cryptocurrency markets first, which would make crypto investors more comfortable with parking their funds into high-risk assets.
When Pepe entered the scene, people flocked to the token because the price was seemingly increasing with no end in sight, not because the token was innovative or useful. Now that the Pepe price has dropped sharply, a large part of its appeal has disappeared.
If you’re interested in exploring meme coins further, check our our article with tips on finding new meme coins like Pepe early.
Source: https://coincodex.com/article/28303/will-pepe-coin-recover/