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PEPE short sellers on Huobi and OKX faced massive liquidations as the meme coin rose 80% in the last 24 hours.
Traders betting against PEPE lost $5 million on OKX and $2.2 million on Huobi on Thursday through margin position liquidations. Traders on Bybit lost $3.6 million.
Skeptics Worry Whales Could Collapse Price in Illiquid Market
Short sellers piled into the BRC-20 meme coin after skeptics warned of large whale concentrations, which could lead to a market dump.
Analysts warned in April that a certain group controlled 10% of the PEPE supply after observing Uniswap trading activity. A whale could collapse the token by selling a fraction of their holdings in a thinly-traded market.
An exchange closes a trader’s position when they lose money pledged as margin for a leveraged trade. The funding rate for short positions is also negative, as short-sellers pay long-position holders to maintain their positions. Large liquidations sometimes foreshadow a local high or low and can inform trading strategies.
The meme coin rose 63% in the last 24 hours to surpass the gains of Dogecoin (DOGE) and Shiba Inu (SHIB), down 0.7% and 1.1%, respectively. At press time, the price of PEPE was $0.00000202, after touching an all-time high of $0.230 earlier.
Trading volume for PEPE in the last 24 hours totaled $651,000. Most of the token’s centralized exchange trading volume occurred on OKX with $250 million, with Uniswap pair PEPE/WETH accounting for $123 million.
BRC-20 Tokens Surpass $120 Million Market Cap
Meme coins often earn investors outsized returns despite having little utility. Their fame often comes from association with a cultural phenomenon or celebrity.
PEPE is based on an internet meme created by artist Matt Furie, depicting an anthropomorphic frog that the Anti-Defamation League added to its list of hate symbols.
PEPE is about two weeks old, minted on Bitcoin with other assets conforming to a new BRC-20 token standard. The standard has seen several meme coins created whose transactions recently surpassed that of Bitcoin.
The market cap of BRC-20 tokens surpassed $150 million in the last week.
Dogecoin, the largest meme coin by market cap, was developed by Jackson Palmer and Billy Markus. Palmer created the coin in 2013 as a satire symbolizing the hype surrounding crypto.
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