Memecoin PEPE has suffered a significant blow with allegations of a potential “rug-pull” causing great turmoil in its investor community. Once considered a high-yielding crypto asset, the value of PEPE has seen an over 80% decline since its peak just four months ago. Now, experts warn of a possible further drop in PEPE’s value due to questionable actions by certain rogue developers.
In a surprising move on August 24, these developers altered the requirements for moving tokens from their multi-sig wallet, reducing the necessary signatures from five-out-of-eight to just two-out-of-eight. Following this modification, these developers transferred $16 million worth of PEPE to crypto exchanges. Some market analysts consider this action a red flag, suggesting the developers intend to sell and possibly precipitate a “rug pull”, an event that would crash the PEPE price potentially to zero.
Previous instances of “rug pulls”, including the drastic fall of MULTI, the token of Multichain’s cross-chain bridging protocol, echo the fears of PEPE investors. Additionally, in 2023, a developer associated with the Encryption AI project was involved in a $2 million “rug-pull” fraud, which caused the Encryption AI token, 0XENCRYPT, to crash by 99% to an all-time low.
However, while certain activities cast a shadow over PEPE’s future, others see a glimmer of hope. A significant increase in the amount of PEPE tokens held by entities holding between 10,000 and 100,000 tokens suggests that some investors are employing a “buy the dip” strategy. This buying momentum indicates a belief among these investors that the market can withstand any additional selling pressure from the token developers.
Supporting this optimism are technical indicators pointing to a possible market rebound, given PEPE’s oversold relative strength index (RSI). There’s also the argument that there’s a recognized accumulation area around $0.00000085. In the June-July 2023 session, this level witnessed a 120% price rally, suggesting a high likelihood of a rebound.
The potential growth and the potential plummet. Two opposing forces wrestling for the control of the PEPE market. But as always within the crypto space, great risk can also mean the possibility of great reward – or great loss. The final verdict rests in the hands, or should we say wallets, of the investors.
Source: Cointelegraph
