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This information came from an on-chain investigation of the PEPE contract, suggesting that the asset is deflationary with an in-built burn functionality.
Amid the ongoing buzz surrounding the recently-launched meme coin PEPE, certain market watchers have conducted on-chain investigations on the asset’s contract code. The results of one of the most recent investigations suggest that the asset is, in fact, deflationary in nature. This means its supply can only reduce from here.
The recent disclosures were made by Cygaar, a notable yet pseudonymous software developer and one of the individuals behind the maintenance of the ERC721A standard.
7) There is burn functionality in this contract, but there is no further minting ability. This means that the supply of PEPE can only decrease from here on out. The tokens held by the blacklisted address can be considered locked up forever as well.
— cygaar (@0xCygaar) May 5, 2023
According to Cygaar, the PEPE contract code has an in-built burn functionality which indicates that tokens can be burned to reduce the asset’s circulating supply. PEPE has a total supply of 420.69 trillion tokens per data from price-tracking resource CoinGecko.
The findings from Cygaar also suggest that the asset’s contract code prohibits minting of more tokens. This means that, while PEPE’s circulating supply can decrease overtime, more tokens cannot be created and brought into circulation. This makes the asset deflationary.
Moreover, it was observed that the PEPE contract deployer blacklisted an address belonging to a pioneer adopter who purchased over 2.5 trillion tokens hours after trading for the asset opened on Uniswap. These tokens are currently valued at $7.6 million.
Notably, the deployer has since then renounced ownership of the contract. As a result, there is no possible way for the blacklist effect on this address to be overturned. This means that the $7.6 million worth of PEPE tokens in the address is locked up forever.
Despite the burn functionality built into the contract code, there is limited information on the availability of a burn mechanism for the asset. This has raised questions and conjectures on how the token can be burned. Some proponents believe the assets could be sent to the blacklisted address to take them out of circulation.
Meanwhile, PEPE has hit a roadblock in its inter-day rally, currently down 5.7% in the past 24 hours. The asset has slipped below the $0.000003 threshold after capturing and staying above it yesterday. PEPE is currently changing hands at $0.00000288 as of press time.