• Pepe coin whale SmartMoney dumped their 1.3 trillion PEPE tokens, worth approximately $2.1 million.
• The dump is likely to spark a selloff wave, with the meme coin price potentially dropping over 40%.
• Smaller retail investors often follow more successful traders’ cues, leading to more extreme volatility in meme coins.
SmartMoney Dumps 1.3 Trillion PEPE Tokens
Meme coin enthusiast SmartMoney has sold their stash of 1.3 trillion PEPE tokens for over 1,160 ETH, worth approximately $2.1 million. The Lookonchain platform reported the news several hours later, predicting the dump could be instrumental in determining PEPE’s upcoming fluctuations.
Retail Investors Follow Whales’ Cues
The meme coin sector can be extremely volatile and unpredictable, so many retail investors not versed in trading follow more successful traders for cues. When SmartMoney bought the initial PEPE stash, many were excited to jump on the bandwagon; conversely, when they sold their holdings, their followers could copy this move and create a selloff wave that would lower the asset price.
PEPE Price Could Drop Over 40% Next Week
PEPE trades nearly 70% below its peak from May 5th ($0.000004836). As of publication, it retested a crucial support line at $0.000001505 but declining trading volumes forecast a possible dip below this level—potentially forcing the meme token price to drop over 40% in the current week if selling pressure increases enough.
Hourly Trading Volume Decreasing
According to dune.com, overall Pepe’s trading has declined after its May 5 peak: hourly trading volume was around $20-30 million then whereas it’s now between $120-130 thousand as of May 22nd 2021 (with no major shifts in “buy”/sell” balance).
Pepe coin whale SmartMoney’s decision to dump their large stash of tokens is likely to lead to a widespread selloff amongst smaller retail investors who follow whales’ cues for investing decisions—potentially causing an approximate 40% drop in Pepe’s token price next week due to declining trading volumes