Most recent update: [June 26, 2023]
What is PEPE?
PEPE is an ERC-20 token that runs on Ethereum, a Proof-of-Stake (PoS) blockchain. The token is referred to as a “meme coin” since it is based on the popular Internet meme “Pepe the Frog”. As described on the token’s website, PEPE seeks to dethrone other meme coins, such as DOGE and SHIB, in order to re-establish itself as the king of all memes. To that end, the token’s website displays a Trump-inspired merchandise with the slogan “Make PEPE Great Again” along with other suggestive images.
While PEPE is not associated with the meme’s creator Matt Furie, it is intended to pay homage to “Pepe the Frog”. The token can be acquired on a variety of platforms or through UniSwap by exchanging ETH tokens for it.
Who is behind PEPE?
As sometimes expected from the world of cryptocurrency, the creators of PEPE are known through their Twitter handle (@pepecoineth) rather than their actual names. The token’s website does not list any contact information besides their Twitter, Discord, and Telegram channels.
How does it work?
As a customized ERC-20 token, it employs a deflationary mechanism that burns a small percentage of tokens with each transaction, thereby creating scarcity. Additionally, every PEPE that is burnt during a transaction is redistributed – in part – to token holders to foster engagement.
The PEPE Token and Tokenomics
The total supply of PEPE tokens is 420.69 trillion, with no additional tokens to be minted in the future. Currently, 93.1% of the above figure is already in circulation. The PEPE token is further described on its website as having “no taxes, no bullshit. It’s that simple”. Further, unlike the majority of cryptocurrencies, the PEPE token was not born out of an ICO. Instead, it was launched discreetly and solely relied on the meme’s popularity, which could explain the token’s meteoric rise that ensued following its launch. The token distribution for PEPE is allocated as follows:
- Liquidity Pool: 93.1% of the total supply
- Multi-sig Wallet: 6.9% of the total supply
The PEPE token is self-admitted on its website to not have any intrinsic value nor utility. The website goes on to describe it as a coin that is “completely useless and for entertainment purposes only” and a project for which there is “no formal team or roadmap”. Nonetheless, in isolation, the PEPE token – just like any other cryptocurrencies – can be used to transfer value from one entity to another. It could therefore be considered as a payment token.
By burning a small portion of PEPE tokens with each transaction, it discourages network attacks since value on a large scale would be required to orchestrate them. Further, as an ERC-20 token, PEPE benefits from Ethereum’s well-established network and community of developers.
Drawbacks and risks
With regards to the market outlook, PEPE is a new cryptocurrency which implies that its adoption has yet to be evaluated, the failure of which could mean that it does not achieve its intended purpose or benefits.
Ironically – or in accordance with the “meme coin” concept – the token’s website states that PEPE has no purpose nor any utility, all of which can therefore be construed as drawbacks and risks for individuals interested in acquiring PEPE tokens.
Before listing PEPE on the VirgoCX Platform, VirgoCX performed due diligence on PEPE and determined that PEPE is unlikely to be a security or derivative under Canadian securities legislation. VirgoCX’s analysis includes reviewing publicly available information on the following:
- The creation, governance, and location of PEPE and/or its primary development team;
- The supply, demand, maturity and liquidity of PEPE; and
- Legal and regulatory risks associated with PEPE.
Statutory Rights under Securities Legislation
VirgoCX is offering Crypto Contracts on crypto assets in reliance on a prospectus exemption contained in the exemptive relief decision Re VirgoCX Inc. dated May 30th 2022 (the Decision). Please be aware that the statutory rights in section 130.1 of the Securities Act (Ontario) and, if applicable, similar statutory rights under the securities legislation of each other province and territory in Canada do not apply in respect of the Crypto Fact Sheet to the extent a Crypto Contract is distributed under the prospectus relief in the Decision.
To learn more about the technology behind Pepecoin, check out these in-depth resources here:
- The official site of Pepecoin
- Coinmarketcap’s overview of PEPE
- Coingecko’s tokenomics overview of PEPE
- Coinbase’s overview of Pepecoin, along with the relevant news and blogs related to SUI.