I have seen a lot of posts lately accusing PEP of being a scam or a fraud. The people making these accusations are either intentionally misleading or simply don’t know what they are talking about. They know that what they are buying on Robinhood is a picture of a frog and that their picture is “real.”
For all the new comers, I want to share a story that happened in the early days of PEPE (Ethereum) token:
After its launch in April 2023, the PEPE token has an initial low market cap and is not yet listed on any centralized exchanges. As an ERC-20 token on the Ethereum blockchain, it can only be traded on decentralized exchanges such as Uniswap. The developers have not given up ownership of the smart contract (yet) and are therefore still able to update it.
When PEPE's market value was still low, one wallet bought more than 2 trillion Pepe tokens at $26 early on. Today, the value of this wallet is more than $60 million.
Cool story, isn't it? But the problem is that the person who owns that wallet can never sell their tokens because the PEPE developer blacklisted his wallet. These PEPE tokens are basically frozen forever and cannot be transferred out of that wallet.
Welcome to Ethereum and decentralized finance.
Also, people really need to understand this: 420 trillion Pepe tokens were minted by the developers. Again, the minting of 420 trillion tokens was free for the developers. They just own 420 trillion tokens (100% of the supply) and then gradually sell them through the liquidity pools of decentralized exchanges because the market value of centralized exchanges is also increasing today. They are selling 420 trillion tokens to you. They don't care what the price of Pepe is because selling it at any price means profit for them.
But wait, how do we know this is all true? It’s all on the blockchain! Anyone can verify this. As we say in crypto: don’t trust, verify!
Everything I just explained about the Pepe ETH token is not possible on Pepecoin (PEP). PEP is a native token on its own proof-of-work layer 1 blockchain. It is not possible for developers to mint PEP tokens just for themselves. There is no pre-mine with developer allocations like is usually the case with new projects. It is a fair launch.
How do we know this is true? It’s all on the blockchain! Anyone can verify this. As we say in crypto: don’t trust, verify!
The only way to get new PEP coins is to mine them. You have to expend economic energy to get new PEP coins. You need hardware (miners), which costs a lot of money. You need a lot of electricity, which costs a lot of money. There is no free lunch and no one is in control. This system works infinitely better to ensure a fair distribution of coins among investors. Everyone has the same rules and the same opportunities. Miners sell a portion of their coins on the free market to cover their mining costs. Then we as investors can buy them.
There are about 88 billion PEP coins mined so far. Each PEP coin requires miners to spend real money to mine.
Recently, we have seen a dramatic increase in hashrate. PEP is merge-minable with Litecoin and Dogecoin, which means large mining pools can start mining PEP with the flip of a switch. PEP's hashrate is now over 1PB, which is crazy. The high hashrate also makes PEP very secure. I'm oversimplifying, but to put it more simply: recently, some large miners with significant mining power have started mining PEP.
I have yet to read a single plausible argument as to why PEP is a scam.
Two other issues raised in this context are that Xeggex is a shady exchange and that the developers plan to “co-opt” the currency.
Xeggex: I have nothing to say about them and I don't care. I buy coins and send them to my own wallet. Don't trust any exchange (big or small). Small exchanges go bankrupt, big exchanges go bankrupt. Buy your coins, send them to your own wallet, simple... not your keys, not your crypto.
Also, consider this: once a coin or token is listed on Coinbase, Binance, Kraken, etc., you are no longer an early investor. The big gains have already occurred. You are late to the party. You are exit liquidity for early investors.
Rugpull: Maybe google it for 10 seconds, what exactly does this mean, shake your head and sigh… Rugpull is when the token creator removes all liquidity from the liquidity pool of the DEX (decentralized exchange), so the token cannot be traded. If liquidity is locked, but the creator has enough supply that he can drain the liquidity pool by dumping a large amount of supply, then the token can also be locked. How exactly is this supposed to happen with PEP? Please elaborate… PEP is not even traded on DEX, it is only traded on CEX.
Despite this, I still hold some PEPE ETH myself. I bought a pack in the summer of 2023. Anticipating a crypto bull run in 2024/2025, I expect PEPE to outperform ETH. Here are my reasons. I don't expect PEPE to go up 100x or 1000x. That's simply not possible since it already has a market cap of $8 billion.
On the other hand, PEP's current market cap is still low at $18 million. If it gains traction, a 100x gain is realistic. Therefore, I sold most of my PEPE ETH and bought PEP while I was still young.
You don’t have to choose one or the other. You can invest in both.
Never marry a memecoin!
Only invest money you are prepared to lose, and generally only allocate a small portion of your portfolio to meme coins.