The meme coin rally, which has recently fueled the rise of Pepecoin (PEPE), seems to be losing its momentum. According to CoinGecko, PEPE’s value has dropped by almost 11% this morning. Nevertheless, the meme coin experienced a massive 215% increase over the past week. Since its debut in mid-April, the frog-inspired token quickly gained traction, and last week it entered the top 100 cryptocurrencies by market cap. Currently, PEPE holds the 52nd position among cryptocurrencies, boasting a market capitalization of $965 million at the time of writing.
The listing of PEPE and Floki Inu (FLOKI) on Binance’s Innovation Zone contributed to the rally. Binance designed this zone to accommodate hyper-volatile cryptocurrencies, expecting investors to acknowledge the potential for total loss. Apart from PEPE, the native SUI token of the Sui network experienced an 11% decrease overnight.
The mainnet of the Move-based blockchain network launched last week, alongside an initial token distribution. The project’s debut drew significant attention to the Sui ecosystem, particularly its NFT ecosystem, as users attempted to mint the earliest collections on the network. The SUI token was subject to selling pressure due to the considerable gains of around 96,000 community members who bought 1,500 SUI tokens for $45. At last week’s peak price of $2.16, this small investment amounted to more than $3,200, as per CoinGecko data. With the ongoing bearish movement, it seems that some traders are cashing in on profits.
As the selling pressure on SUI intensifies, analysts have raised concerns about tokens allocated to market makers and investors. Market makers have been allocated 75% of the token’s initial circulating supply, which many analysts consider “predatory.” Given that market makers typically hedge their positions, this allocation creates potential selling pressure if they decide to close their positions. Moreover, about 44% of the total supply is designated for the team, investors, and early contributors.
TokenUnlocks’ data indicates a prominent unlock of 14% of the total supply in December 2023, as part of the vesting schedule. The current market trends and token allocations highlight the volatile nature of cryptocurrencies like PEPE and SUI. As several factors contribute to the selling pressures, it is crucial for investors to proceed with caution and stay informed about the potential risks associated with such investments.
Disclaimer: The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.
Source: Decrypt
