Key Takeaways
- Canary Capital submitted an S-1 filing to the SEC on Wednesday for a spot PEPE exchange-traded fund
- The PEPE token fell 4.58% Wednesday and continued its descent Thursday, dropping beneath $0.0000036
- Long-to-short ratio plummeted to 0.81, marking the weakest level in more than 30 days and reflecting bearish momentum
- Funding rates shifted into negative territory at -0.0081%, indicating short positions are compensating long positions
- PEPE maintains a market capitalization of $1.5 billion with a total token supply exceeding 420 trillion
Canary Capital submitted an S-1 registration document to the U.S. Securities and Exchange Commission this Wednesday, requesting authorization to introduce a spot exchange-traded fund for Pepe. This application aims to track the performance of PEPE, the popular frog-inspired meme cryptocurrency that debuted in April 2023.
Contrary to expectations, the announcement failed to boost PEPE’s market value. The digital asset experienced a 4.58% decline on Wednesday and maintained its downward trajectory through Thursday, with prices settling beneath the $0.0000036 threshold.
Canary Capital has demonstrated consistent interest in the memecoin ETF sector. Throughout the previous year, the investment firm submitted applications for exchange-traded funds focused on MOG and Pengu, establishing itself as among the select asset management companies pursuing funds connected to niche, meme-oriented cryptocurrencies.
The registration document acknowledges that PEPE lacks inherent functionality. The token operates exclusively as a speculative investment vehicle with an aggregate supply surpassing 420 trillion units.
Should the ETF receive regulatory approval, conventional investors would gain the ability to obtain PEPE exposure without directly purchasing the cryptocurrency. Such approval might also enhance market liquidity and confer additional credibility to the digital asset. However, these potential benefits would materialize only following approval, which remains uncertain.
Market Data Reveals Bearish Trends
On-chain metrics from CryptoQuant indicate varied market conditions with emerging bearish indicators. Derivatives market activity suggests sellers currently maintain control.
PEPE’s long-to-short ratio on CoinGlass descended to 0.81 Thursday. This represents the weakest measurement recorded in over 30 days. A ratio beneath 1.0 demonstrates that more market participants anticipate downward price movement than upward momentum.
Funding rates simultaneously turned negative, registering -0.0081% on Thursday. Negative funding rates indicate short position holders are compensating long position holders — a characteristic signal of bearish positioning within derivatives markets.
Significant whale transaction activity appeared across both spot and futures markets, which certain analysts interpret as a moderately encouraging indicator. Nevertheless, prevailing market sentiment remains guarded.
Critical Price Thresholds
PEPE momentarily surpassed the 50-day Exponential Moving Average at $0.0000036 Tuesday, recording gains exceeding 11%. The token failed to maintain this threshold and retreated the following session.
Should the downward price movement persist, the immediate support level resides at Tuesday’s minimum of $0.0000033. A breakdown beneath this point could propel PEPE toward the February 6 bottom of $0.0000031.
The Relative Strength Index on the daily timeframe stands at 50 with a downward trajectory, implying diminishing purchasing pressure. The MACD indicator continues displaying a bullish crossover established last week, which remains valid.
PEPE was exchanging hands at $0.0000036 with a market capitalization of $1.5 billion as of Wednesday at 5:49 p.m. ET.
