What I saw this morning shocked me because another cryptocurrency trader discovered a major fortune in memecoin investing. PEPE token, known for its frog theme, turned $2,184 into $43 million despite lacking any real practical value. A skilled individual transformed $2.184 into the impressive $43 million final value.
Lookonchain has revealed that this retail investor seized 1.5 trillion PEPE tokens at rock-bottom prices in the early days. At its height, that stash hit $43 million. The trader made $10.3 million from this transaction by selling 1.02 trillion PEPE for $6.66 million and maintaining 493 billion PEPE valued at $3.64 million. That’s a 4,718x return!
The decreasing value of Pepe from its peak of $0.00002825 on December 9, 2024, amounted to a 74% drop, yet the trader successfully became a millionaire. The memecoin phenomenon continues to produce unpredictable results, as I reported about FTX repayments in yesterday’s blog post, and finds this situation to be the opposite of crypto’s unpredictability.
Why Memecoins Are Stealing the Show
PEPE represents the absolute extreme of price fluctuation because its value derives entirely from social media activity instead of having any technical functions or meaningful purpose. Yet they keep minting millionaires. A single PEPE purchase worth $27 in May 2024 evolved into $52 million through PEPE using a multiplying power of 1.9 million.
Nexo representative Stella Zlatareva stated to Cointelegraph that volatile tokens, including memecoins DOGE, PEPE and FLOKI, have shown average growth at 5.6% due to rate cut expectations and cryptocurrency trends. They occupy the fashionable seats at the crypto dias.
But there’s a catch. Dan Hughes from Radix indicated that memecoins function as nothing more than circular exchanges of existing cryptocurrency funds rather than attracting new investments. TRUMP tokens on Solana have lost 51% of their value since their January introduction because investors engaged in a FOMO-fueled exchange of cryptocurrencies.
Numerous market transitions, mainly caused by Trump’s trade threat from 2018, have created a bubble-like effect where capital cycles within the system. Fun for winners, brutal for latecomers.
The Dark Side and What’s Next
The main drawback exists within memecoins because they operate like a high-risk market. Insider schemes and rug pulls have become prevalent across the crypto industry, especially with the case of the Libra token and Javier Milei. New York lawmakers quickly introduced legislation on March 5 which would protect investors from the fallacies they face.
The PEPE trader stands out as an exceptional investor, though many others face unfavorable outcomes in this market. The real $10.3 million gain exists, although PEPE stands at $0.0000071 while maintaining unpredictable price swings. Will it climb again or flop? Hard to say.
I relax in my chair, happy with the wildness I have witnessed. Due to its status as a casino, Crypto offers risky slot machines in the form of memecoins, which produce occasional dramatic changes. The future potential of this development remains unclear because it represents either an emerging trend or a potential warning to investors. It would be great to hear your thoughts regarding this turbulent situation.
