PEPE Extends Six-Week Drop as Whales Accumulate 23T Tokens

PEPE has extended its decline for a sixth consecutive week, as of Wednesday. The meme coin market has seen renewed weakness. The weakness in the market is due to tighter liquidity conditions. On-chain data, however, suggests that major wallets’ accumulation has remained strong despite the weakness.

There has been a decline in the general sentiment of the meme coin market. Market liquidity has fallen in the overall altcoin market. 

Additionally, retail participation has fallen. The overall weakness in the meme coin market has raised concerns over the ability of the PEPE coin to sustain itself in the short term.

Major Wallets Add 23T PEPE After Wynn’s Exit

Last month, trader James Wynn had a large position in the PEPE coin on the Hyperliquid platform. He had indicated that the meme coin’s market capitalization could touch $69 billion by 2026. 

The coin saw an upward move following the prediction. Two weeks later, the trader indicated that he had closed all his positions and sold the entire PEPE position.

Despite the trader’s exit from the position, major investors’ accumulation has remained strong. Santiment data indicates that during the last four months, the top 100 wallets have amassed approximately 23.02 trillion PEPE tokens. 

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The increase in the number of tokens accumulated by the major investors began with the overall market-wide sell-off in October.

Santiment pointed out that large wallets hold an important position in the altcoin cycle. Large wallets indicate the beginning of a possible trend inversion through their accumulation patterns. 

The firm further pointed out that the sentiment toward meme coins remains bearish, and such coins usually experience a breakout when Bitcoin shows sustained uptrend movement.

Liquidity Concerns Influence PEPE’s Rebound Prospects

According to analyst Defi Priest, the token is likely to experience a short-term rebound, and this is due to the current market conditions. 

However, analysts are warning investors of the possibility of a new local low, considering the worsening liquidity conditions. At the moment, investors are hesitant to add to their positions, especially in high-risk assets.

Benjamin Cowen, a popular market analyst, pointed out that meme coins experience the greatest pressure when liquidity conditions tighten. 

According to Cowen, meme coins might not be able to survive if the situation worsens, and this has created uncertainty about the next big move of PEPE and other meme coins.

CryptoQuant data shows that the meme coin dominance in the altcoin sector is still low. The metric refers to the performance of the market capitalization of meme coins compared to the altcoin sector as a whole. 

Source: CryptoQuant

According to the analyst, an increase in this metric will be a clear indication of an improved setup for the token and other meme coins.

Also Read: PEPE Coin Slides Amid Bitcoin Dip and US Government Shutdown Risk