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- Pudgy Penguins (PENGU) saw a rapid rise and fall in market capitalization
- The launch of $TRUMP and $MELANIA memecoins drained liquidity from other projects
- Bonk Inu and DogWifHat showed quicker stabilization compared to Pudgy Penguins
A couple of weeks ago we reported how a new memecoin on Solana based on one of the most popular NFT collections in the world quickly rose through the ranks becoming the most valuable SOL-based memecoin by market capitalization.
At the time, Pudgy Penguins (PENGU) had seen an incredible start to its journey as a traded digital asset, growing by almost half a billion dollars in market capitalization in less than a week, reaching an ATH of $2.9 billion according to CoinMarketCap. By January 15th, the new coin had surpassed Bonk Inu to become the network’s top memecoin.
However, time hasn’t been so kind to the penguin-inspired cryptocurrency. Since then, $PENGU lost over half of its market capitalization, currently at around $1.1 billion. The token also suffered a big hit, losing almost 70% of its value throughout the month.
Currently, $PENGU is trading around $0.017, down by 16.93% in the day, and a 25.62% retraction over the last week.
No Country for Young Memes
The most obvious factor behind the penguin sell-off can be attributed to the two “presidential” memecoins launched on Solana on the weekend before Donald Trump’s inauguration. At the time, $TRUMP and $MELANIA became the biggest talking point in the crypto community as debates arose about the ethicality of a sitting President launching an official memecoin.
But whether ethical or not, the truth of the matter is that the two memecoins have taken the market by storm. As memecoin investors tried to jump in to buy the Trumps tokens, the liquidity was drained from other memecoin projects like Dogecoin, and Shiba Inu.
This effect was even worse on the Solana Blockchain, as swapping one token for another was not only easier, but cheaper. Adding to this effect is the notion that investors had already been taking profits around January 6, after $PENGU’s major upward trend had begun to fade.
Moreover, this phenomenon continued in the market until January 18th when $TRUMP debuted. Since then, $PENGU continued to lose value daily, losing over 46% of its value until today.
While the Solana Blockchain memecoins Bonk Inu and DogWifHat also suffered similar losses, the two “dogged” competitors have shown signs of stabilization quicker than Pudgy Penguins.
As two “seasoned” memecoins, perhaps Bonk Inu and DogWifHat have managed to weather the storm better due to their established communities and stronger market presence. In contrast, Pudgy Penguins, being relatively newer, struggled to maintain investor confidence amidst the influx of new coins, an effect particularly heightened by the profit-taking seen just before the Trump memecoins.
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