Blockchain data is raising questions about the “for the people” narrative surrounding the launch of memecoin Pepe, with new analysis indicating that nearly a third of the initial supply was controlled by a single entity, which contributed to significant early selling pressure.
Approximately 30% of the Pepe (PEPE) token supply was aggregated at launch in April 2023, as reported by blockchain data visualization platform Bubblemaps on Wednesday, adding that investors were “deceived.”
The same wallet cluster sold $2 million worth of PEPE tokens the day after the launch, creating substantial sell pressure that prevented the token from surpassing the $12 billion mark, according to Bubblemaps.
This concentration of the initial supply contradicts Pepe’s promotional identity as a “coin for the people.” The project’s website claims the token launched “in stealth” with no presale allocations.
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PEPE’s price fell by 5.7% in the past 24 hours and has decreased over 81% in the past year, according to CoinMarketCap data.
Further raising investor concerns, Pepe’s website was compromised earlier in December, momentarily redirecting users to a malicious inferno drainer, a scam tool used for phishing attacks and wallet thefts.
Despite the decline in PEPE’s value, some crypto traders have turned profits amounting to millions with the memecoin.
In March, one trader transformed an initial investment of $2,000 into $43 million by holding PEPE. The trader realized a $10 million profit on their position after enduring a 74% drop from PEPE’s all-time high before exiting.
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Forensics tool targets insider-heavy launches
The recent findings were uncovered using Bubblemaps’ Time Travel feature, a forensic-grade analytics tool launched earlier in May. This tool allows Web3 users to reconstruct the historical distribution of tokens to identify early insider activity or organized accumulation efforts aimed at preventing rug pulls and memecoin scams.
Identifying tokens with a substantial portion of the supply held by a few wallets can help investors spot scams like rug pulls, where insiders drain liquidity or execute a mass sell-off, leading to rapid price drops that leave investors with worthless tokens.
Bubblemaps has played a crucial role in revealing suspicious wallet activity related to various memecoins, including the Melania token and numerous counterfeit Eric Trump-themed memecoins.
In one of this year’s most devastating rug pulls, the Wolf of Wall Street-inspired WOLF token plummeted 99% within hours, erasing nearly $42 million in market capitalization on March 16.
The token was created by Hayden Davis, the co-creator of the Official Melania Meme (MELANIA) and the Libra token.
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