- The calm in PEPE’s price action may have spelled doom for the BTC and the broader market.
- There was an absence of new interaction with the token.
The enthusiasm surrounding Pepe [PEPE], the meme-based cryptocurrency, which only emerged a few weeks ago has raised concerns among some market observers. Needless to say, the PEPE frenzy captured the attention of many investors and traders.
Read Pepe’s [PEPE] Price Prediction 2023-2024
However, it might not be best for the broader market, according to a new Bloomberg report. Released on 14 May, the data and market media conglomerate noted that the aura around the frog-themed token screamed pain for the market, especially Bitcoin [BTC].
Recall that the rise of PEPE was accompanied by a significant increase in speculative trading activity and frenzied buying. And around the same period, the BTC value dropped and consolidated.
Dampened euphoria is no good cause
But Bloomberg highlighted that this type of market behavior is often associated with euphoria and can be a warning sign of an overheated market.
Usually, when investors rush into an asset solely driven by hype and Fear Of Missing Out (FOMO), it can create a speculative bubble that is vulnerable to sharp price corrections.
And since PEPE lacked any utility apart from community support, a drop in the excitement level could distort the market.
In a segment of the report, Joe Rotunda opined that the drawdown has now affected investors’ ability to chase opportunity zones with other assets.
Given its popularity and speculative nature, PEPE has corrected despite its 2,8931% hike in the last 30 days. At press time, the token’s value was $0.0000017. However, the price was not the only part that has been affected by a decline.
No vigor backing the meme
According to Santiment, the volume which reflects the strength behind the price action had also flattered. At the time of writing, the metric, which once skyrocketed to 2.91 billion, had decreased to 414.24 million.
Source: Santiment
Furthermore, the traction the meme gained in the process of its incredible surge had diminished. This inference was based on the information displayed by the network growth.
The network growth describes the number of new addresses that have been involved in transacting the token for the first time. At press time, the network growth was down to 1108.
Realistic or not, here’s PEPE’s market cap in BTC terms
In terms of circulation, Santiment showed that the seven-day trend had changed its momentum. The circulation of a token refers to the number of unique tokens transferred on a given day.
In this metric, when tokens change hands five times on a particular day, the circulation is counted once. At the time of writing, the circulation had decreased to 118.68 trillion.
Source: Santiment
