Launched on April 14, the Pepe (PEPE) meme token surged more than 217% in the past 24 hours, yet users cannot sell the coin due to a liquidity crunch.
“The most memorable memecoin in existence. Dogs had their day; it’s Pepe’s turn to rule,” the project’s site says.
The token harks back to the well-known Pepe the Frog meme, which first appeared in 2005 in Matt Furie’s webcomic Boy’s Club. It later became a symbol of support for former US President Donald Trump.
According to data from Etherscan, 420.69 trillion coins are in circulation. At the time of writing, PEPE’s market capitalization is $111.36 million, and the number of holders is 22,000.
Despite the momentum and the price surge, traders cannot cash out their tokens due to liquidity problems and weak demand.
For example, one user, during the coin’s launch, bought 5.9 trillion PEPE for 0.125 ETH (about $250 at the time of the transaction). The current market value of his meme tokens is around $1.02 million.
“With that amount in his portfolio, it would take 46,200 years to liquidate these assets, assuming demand does not fall,” said Conotoxia analyst Grzegorz Drozd in a conversation with Decrypt.
He noted that attempting to sell the tokens could lead to a sharp drop in the asset’s price.
According to ImmuneFi’s CTO Adrian Hetman, the problem with such assets “lies not only in the absence of buyers, but also in the fact that their liquidity is usually concentrated in automated market-maker pools,” which prevents large trades.
In April, Bloomberg Intelligence strategist Mike McGlone expressed concern about mem-tokens Dogecoin and Shiba Inu, calling them “naturally speculative assets.”