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Pepe is the latest memecoina category of altcoins, or smaller cryptos after heavyweights Bitcoin and Ether to capture the attention of the crypto crowd. Dogecoin, referencing the doge meme, is the eighth-largest digital asset by market capitalization, with similarly dog-themed crypto Shiba Inu close behind.

For its part, Pepe references the Pepe the Frog memewhich has a checkered cultural reputation. The Anti-Defamation League (ADL) has named the Pepe the Frog meme a hate symbol, while noting that the character did not initially have racist connotations and that many uses of the meme continue to be non-bigoted.

Pepe has taken off since its launch in April, with its listing on OKX last Monday and addition to Binancethe worlds largest crypto exchangelast Friday acting as accelerants, funneling new liquidity to trading in the token.

Pepe prices ripped higher in turn, with its market cap surging from $280 million before the OKX listing to a peak of $1.8 billion after it was listed on Binance, with trading volume in Pepe at times dwarfing that of much larger memecoin peers such as Dogecoin, according to crypto data provider CoinGecko.

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The rally has since cooled, likely as a result of profit-taking, with Pepes market cap falling to near $430 million on Wednesday.

But dont expect such a frenzy to fall flat so soon, especially since it looks like whales (holders of significant amounts of crypto) are getting involveda sign that trading in Pepe is attracting more influential market participants.

Three whales have started to buy Pepe in force since prices dropped back from their peak, crypto analytics group Lookonchain detailed via Twitter on Tuesday, citing public blockchain network data. Two of those whales hold positions worth more than $1 million combined at current prices, while Lookonchain noted that the third began withdrawing Pepesome $2.76 millionfrom Binance.

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Another whale, Lookonchain detailed Wednesday, has steadily bought Pepe across the past three days, scooping up around $150,000 in this current spree.

These positions might seem small in size compared with the total market cap of Pepe, but they have the potential to be market-moving in the volatile memecoin space.

More broadly, the attention of whales may signal that this memecoin frenzy is more than a flash in the pan, potentially symptomatic of improving sentiment in one of the most risk-on corners of the marketor just more crypto hype.

Write to Jack Denton at jack.denton@barrons.com

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Dogecoin Rival Pepe Hooks Crypto Whales. Memecoin Frenzy May Just Be Starting. - Barron's