In an announcement on May 5, Binance said the exchange will list two memecoins FLOKI and PEPE in the Innovation Zone, which is considered highly volatile and risky. Users can trade FLOKI/USDT, FLOKI/TUSD, PEPE/USDT, and PEPE/TUSD spot trading pairs from 16:00 (UTC) on May 5, 2023. Users will enjoy zero maker fees on the FLOKI/TUSD and PEPE/TUSD spot trading pairs until further notice.
However, the exchange did not forget to warn users that FLOKI and PEPE are new tokens, which are so risky and therefore, will have a strong volatility in price. According to Binance, PEPE has no token utility or value support mechanism. There are also many signs that the anonymous project team holds more than 7% of the total supply since the token issuance.
A few hours ago, PEPE reached $1 billion in market cap, making it to the top 50 largest coins in the market. Although this memecoin once lost nearly $200 million in market cap as whales took profits, PEPE’s market cap now is $1.5 billion.
Following Binance’s announcement, FLOKI and PEPE have had an impressive increase in price. PEPE price has increased by more than 130% over the past 24 hours, currently trading around $0.00000399. Meanwhile, FLOKI is also up nearly 60% and is priced at $0.0000518.
Earlier this week, PEPE trading volume even surpassed Dogecoin (DOGE) and Shiba Inu (SHIB). In fact, the memecoin craze has burned over $10 million in Ethereum transaction fees on Uniswap over the past three weeks.
Despite the huge profits, traders struggle with the problem of lack of liquidity. A report by Nansen points to a case where a whale sold $2.2 million worth of PEPE but only collected $650,000 worth of ETH “due to a sharp slippage”.
During the AMA on Twitter Space on May 1, Binance CEO Changpeng Zhao admitted that he did not really understand memecoins and that the exchange only listed tokens that benefit users. According to CZ, Binance has a separate team to evaluate assets and he does not want to get involved. Binance once listed SHIB and recognized it as one of the cryptocurrencies with a large trading volume on Binance. So, Binance does not take a stance against memecoins or any tokens.