The world of cryptocurrencies is surprised as Pepe (PEPE), the meme coin featuring the iconic frog-themed meme, undergoes an unexpected 20% drop in value. A series of major incidents has unsettled the cryptocurrency community, raising questions about the security of a multisig wallet, unusual token transfers, and the potential for a developer-driven back pull.
Pepe Coin is in big trouble
The meme-inspired cryptocurrency Pepe (PEPE), which has garnered attention with its frog-themed concept, has experienced a sharp 20% drop in price. This sudden drop has cast a cloud of uncertainty over the realm of crypto. The chain of events leading up to this upheaval began with a remarkable transfer of $16 million worth of Pepe tokens from the developers’ multisig wallet to various cryptocurrency exchanges.
The actions of developers lead to suspicion
This eyebrow-raising maneuver has created a wave of suspicion about the developers’ intentions. The massive movement of $16 million worth of Pepe tokens from the developers’ wallets to exchanges has raised concerns that the developers may be considering selling their holdings. Such a move could potentially disrupt the currency’s value, sending ripples through the investment community.
Read more: PEPE price analysis: With PEPE coin price crashing this week, is there a reversal in the charts?
Why have security protocols changed?
Adding to the inconvenience is the change made to the security protocols of the multisig wallet. Where previously the consensus of five of eight signatures was required for transaction approvals, the wallet now only requires two of eight signatures.
This change in protocol has led to speculation that the developers may be orchestrating an exit strategy, allowing rapid transfers without the need for broad consensus.
Token transfers spark intrigue
Looking into the details, significant amounts of Pepe tokens were transferred to multiple exchanges, including $8.36 million to OKX, $6.6 million to Binance, and $438,000 to Bybit.
Another $400,000 found its way into a secret purse or wallet, adding layers to the puzzle. It is important to note that approximately $10.42 million worth of Pepe tokens are still held in the multisig wallet.
The movement of a whopping 16 trillion Pepe tokens, equivalent to about 4% of the total supply, to exchanges and a secret wallet address has increased concerns within the community.
As it is the first time that Pepe tokens have been transferred from the project’s multisig wallet to a cryptocurrency exchange, it raises suspicions of a “back pull,” a process by which developers withdraw their holdings after selling the project , causing the value of the currency to plummet and investors to suffer losses.