Blockchain data is casting doubt on the “for the people” launch narrative of memecoin Pepe, with new analysis suggesting that nearly a third of the initial supply was held by a single entity and contributed to heavy early selling pressure.
About 30% of the Pepe (PEPE) token supply was bundled at launch in April 2023, blockchain data visualization platform Bubblemaps claimed Wednesday in a post on X. The platform added that investors were “lied to.”
The same wallet cluster sold $2 million worth of PEPE tokens the day after launch, adding significant sell pressure that stopped the token from surpassing the $12 billion milestone, according to Bubblemaps.
This concentration of the genesis supply contrasts with Pepe’s original branding as a “coin for the people.” The project’s website states the token launched “in stealth” with no presale allocations.
PEPE’s price fell 5.7% in the past 24 hours and is down over 81% in the past year, according to CoinMarketCap data.
Adding to investor concerns, Pepe’s website was exploited earlier in December, temporarily redirecting users to a malicious inferno drainer. This is a scam tool used for phishing attacks, wallet drainers, and social engineering scams.
Despite PEPE’s downside, some crypto traders managed to make millions of dollars on the memecoin.
In March, one trader turned an initial investment of $2,000 into $43 million by holding PEPE. The trader realized a $10 million profit on his position, having held through a 74% decline from PEPE’s all-time high before selling.
Forensics Tool Targets Insider-Heavy Launches
The latest findings were uncovered through Bubblemaps’ Time Travel feature. This is a forensic-grade analytics tool launched earlier in May that enables Web3 users to reconstruct the historical distribution of tokens. The aim is to detect early insider activity or coordinated accumulation efforts to prevent rug pulls and memecoin scams.
Spotting tokens with a large portion of the supply concentrated across a few wallets can help investors detect scams such as rug pulls. In a rug pull, insiders remove liquidity or stage a mass sell-off, resulting in a steep price collapse that leaves investors with worthless tokens.
Bubblemaps played a key role in uncovering suspicious wallet activity related to multiple memecoins. This includes the Melania token and an array of fake Eric Trump-themed memecoins.
In one of this year’s most damaging rug pulls, the Wolf of Wall Street-inspired WOLF token crashed 99% within a few hours, wiping out nearly $42 million of market capitalization on March 16.
The token was created by Hayden Davis, who is also the co-creator of the Official Melania Meme (MELANIA) and the Libra token.