Crypto

$PEPE: Three Ingredients to the Meme Coin’s Success Amidst the Bear Market

07/06/2023
Bitcoin Ethereum News

OP-ed disclaimer: This is an Op-ed article. The opinions expressed in this article are the author’s own. CoinCodex does not endorse nor support views, opinions or conclusions drawn in this post and we are not responsible or liable for any content, accuracy or quality within the article or for any damage or loss to be caused by and in connection to it.

Initially created by cartoonist Matt Furie, Pepe the Frog is one of the oldest and most well-known internet memes. Few expected it could steal the show from DOGE, SHIB, and all the other meme coins.

Meet $PEPE: a meme coin based on Pepe the Frog, which surged nearly 10,000% between April 17 and May 5 before entering into a correction. But even while the total crypto market cap dropped by 10.37% between April 17 and May 19, PEPE’s all-time ROI still  at a whopping 2,570%.

How did a new meme coin rise so quickly to become the 69th top cryptocurrency by market cap?

The Power of a Meme

As I see it, the most valuable asset behind the PEPE meme coin is the meme it originated from. From trading cards to a symbol of the 2019-2020 Hong Kong protests, Pepe the Frog is widely recognized among internet users, and PEPE’s creators capitalized on that.

PEPE was launched on April 17th. Post-launch, the PEPE community started to rely heavily on advertising and word-of-mouth to attract new holders; three days later, the meme coin reached a $31.58 million 24-hour trading volume.

Despite its popularity, Pepe the Frog has a somewhat controversial past, which Coinbase used as an argument against PEPE and meme coins. While the Anti-Defamation League stated that most instances of the meme were not used for this purpose, it included the meme in its hate symbol database, while variants of the original Pepe are reportedly connected to far-right themes.

Pepe’s Winning Recipe

Three factors could have contributed to the PEPE’s success. First, the team created a coin around a popular meme that is recognized by nearly all internet users.

Second, PEPE’s creators have pumped up the token with money, increasing the number of holders to 69,000 by May 1 and generating massive hype via Time Square billboards and other promotions. Seeing the meme coin trending on social media and its price skyrocketing — combined with potential market manipulation  — many were drawn in by Fear of Missing Out (FOMO) and jumped on the bandwagon to purchase the asset in the hope of making record gains.

Third, PEPE’s passionate community leveraged the controversy around the coin to boost organic marketing.

pepe salt

As the meme coin’s supporters argued that it is not a hate symbol but “a symbol of love,” the term “DELETECOINBASE” was trending on Twitter just one day after Coinbase published a controversial newsletter calling the meme behind PEPE a hate symbol. The exchange was forced to issue a public apology on May 11, admitting that the team failed to share the whole picture.

Good Ol’ Market Manipulation

So was this success crafted by a group of talented crypto entrepreneurs — or was it pure luck? There is also a third scenario in which a sizeable crypto organization might stand behind PEPE’s launch. 

Source: Lookonchain

After adding 93.1% of the total supply to a Uniswap V2 pool, 38% of all $PEPE was bought by 81 addresses during an initial private sale on the same day the coin was created.

 

If we consider the results of the initial private sale on the day of issuance, the sudden hype around the token, and the fact that it took only a few weeks to get listed on top exchanges like Binance, OKX, Kraken, Huobi, and KuCoin, this theory starts to make the most sense.

Adding to that the team’s anonymity and the fact that the top 50 holders control nearly 54% of the total supply, I believe PEPE’s massive success could involve at least some shady tactics and market manipulation.

In this hypothetical case, the meme coin doesn’t offer any value for retail holders. However, it would become a super valuable asset for prominent market players, who could capitalize on its popularity to boost their business revenue via trading commissions and other fees their users pay on the platform.

Mastering Memecoin Launch With PEPE

It’s hard to tell whether PEPE’s massive popularity was due to a brilliant team, pure luck, or an organized scheme to manipulate the crypto market. 

In any scenario, it presented us with a perfect case study on how to conquer the market in only a few weeks by mastering the science of a meme coin launch. 

A community unified under a well-known symbol (meme) combined with money and smart initial distribution (and potential market manipulation) was enough for PEPE’s short-term success. And the memecoin kept trending among Twitter users.

While some have written songs about the memecoin, others have gone as far as to describe the PEPE community as an “army of frogs” with “no individual matters”.

As you can see, the narrative behind PEPE has become the following: magic internet money owned by the people. This created a movement that even turned Christopher Berrios, the founder of WallStreetBets’ private Facebook group, into an enthusiastic backer of the memecoin.

That said, meme coins’ popularity should always be taken with a pinch of salt. While it could be the next big thing, pump-and-dump strategies should be no stranger to the crypto-enthusiast. Remember to DYOR, and make weighted decisions.

Author

Olga Kazmina is a senior growth strategist with 7+ years in the Web3 space and Founder of zero1team.xyz.

Olga has been involved in the Web3 space since 2016, back when it was still commonly known as crypto. As a member of the founding team of Sonm, an open-source, decentralized computing platform, she has built the brand from ground zero and played an instrumental role in building a strong community of supporters. Now she also founded zero1team.xyz a boutique agency offering community development & expansion for Web3 projects and fintech.

Source: https://coincodex.com/article/29575/pepe-three-ingredients-to-the-meme-coins-success-amidst-the-bear-market/