What is Pepecoin? Everything you need to know about the meme token that notched a $1.6 billion market cap then crashed 70% within days

• Pepecoin surged to over $1 billion in market value this month, but its price has since crashed 70%.
• Like Dogecoin and Shiba Inu, it's a meme token with no use case and trades at a fraction of a cent.

Pepecoin grabbed headlines in the cryptocurrency world and beyond this month – with its staggering rise and rapid fall reigniting the discussion about what roles meme tokens should play in the digital asset space.

Here's everything you need to know about the coin, including what its wild price fluctuations mean for the broader crypto market.

What is Pepe?

It's a new cryptocurrency that launched on April 19 and was inspired by the well-known "Pepe the Frog" meme, created by cartoonist Matt Furie in 2005.

The amphibian-themed token's developers have so far remained anonymous but have amassed over 270,000 followers on a Twitter account where they've pledged to give investors "the most memeable memecoin in existence."

The Pepe symbol itself regularly appears on internet message boards including 4chan and Reddit and has ties to the far right. It was classed as a hate symbol by the Anti-Defamation League in 2016, but it's also been used by pro-democracy protesters in Hong Kong.

Coinbase described the meme's usage by racists in a newsletter on meme coins published last Wednesday – but its chief legal officer apologized a day later after the exchange received widespread criticism from crypto traders.

How is the token performing?

Mass promotion of Pepe on Twitter fueled a trading frenzy shortly after it launched – and by May 5, its market capitalization hit $1.6 billion, according to data from CoinMarketCap.

But the token's rise – which its developers said was "fueled by pure memetic power" but was actually likely a result of speculators wildly pumping – proved short-lived.

The meme coin's price has plunged by around 70% from its peak 10 days ago – coinciding with a broader crypto sell-off.

Since its launch, Pepecoin has traded at just a fraction of a cent – but a circulating supply of nearly 392 trillion tokens means it's still the 66th-largest cryptocurrency by total valuation even after its recent losing streak, per CoinMarketCap.

What are meme coins?

Meme coins – or "shitcoins", if you're a crypto sceptic – are tokens that have zero underlying value but are still popular with traders because of their links to well-known memes.

The most famous example is Dogecoin, which counts Tesla and SpaceX CEO Elon Musk as a longtime fan.

Doge achieved widespread fame during the 2021 crypto boom, when it rallied from under a cent to an all-time high of $0.69.

Another well-known meme coin is Shiba Inu, which like Pepecoin surged after its initial launch, only to crash a few weeks later.

The token, branded by its developers as the "Dogecoin killer", surged 240% in a week in October 2021 – but has erased the bulk of its gains since then.

What does all this mean for crypto?

Pepecoin's massive popularity and subsequent slide could be a bad sign for larger cryptos, including bitcoin and ether.

Explosions in the trading of meme coins have typically been seen as a sign of a bubble – because they show that investors lured in by high valuations are buying and selling purely speculative tokens.

Bitcoin started 2023 with four straight months of gains but has plunged 6% since Pepecoin's launch on April 19.

Ether is down 8% over the same period, while fellow large-cap token solana has plummeted 14% since the frog-based crypto first listed.