PEPE Investors Lose Ground as Profitability Plummets in Declining Market

Amidst a 26% drop in the past week, on-chain data reveals that only 69% of PEPE investors remain profitable. IntoTheBlock's analysis shows a significant portion (27%) facing losses, suggesting a potential bottom formation as profit-selling exhausts at lower profitability levels.

PEPE Investors Facing Diminished Returns as Market Profitability Declines

On-chain data analysis reveals a significant decline in the profitability of PEPE investors, with only 69% of addresses currently carrying gains. This represents a sharp drop from the previous week, during which the memecoin experienced a 26% plunge in value.

Measuring Investor Profitability

IntoTheBlock, a leading market intelligence platform, utilizes on-chain history to gauge investor profitability. By comparing the average cost basis of an address with the current spot price, IntoTheBlock categorizes addresses as either "in the money," "out of the money," or "at the money."

PEPE's Profitability Breakdown

According to IntoTheBlock's analysis, 69% of PEPE addresses are currently "in the money," meaning their cost basis is lower than the current spot price. Conversely, 27% of addresses are "out of the money," while 4% are "at the money."

Comparison with Other Cryptocurrencies

The profitability ratio for PEPE is significantly lower compared to other major cryptocurrencies. For instance, 89% of Bitcoin investors are currently in profit, highlighting the recent price drawdown experienced by PEPE.

Implications for Market Dynamics

Historically, addresses carrying gains tend to be more likely to sell, potentially triggering mass selloffs when the market is heavily overextended. Conversely, low profitability levels can indicate potential bottom formations, as profit-selling becomes exhausted.

PEPE's Current Market Position

Currently, neither green (profitable) nor red (unprofitable) investors dominate the PEPE market. However, during bull runs, profitability levels typically remain higher, suggesting that any cooldown in investor profitability could provide a catalyst for price rebounds.

PEPE Price Performance

Following the recent price decline, PEPE has returned to the $0.0000050913 mark. The chart below depicts the memecoin's performance over the past month, highlighting the significant drop in the last few days.

[Chart of PEPEUSD performance over the past month]

Conclusion

The decline in PEPE investor profitability to 69% aligns with the recent price drop. While the profitability ratio is not excessively low, it indicates the potential for a bottom formation if the bullish market trend is to continue. However, it is crucial for investors to conduct their own due diligence and recognize the risks associated with any investment decision.