Key Highlights
- Canary Capital submitted an S-1 filing to the SEC on Wednesday for a spot PEPE exchange-traded fund
- The token’s price fell 4.58% on Wednesday and extended losses Thursday, dipping under $0.0000036
- Long-to-short ratio plummeted to 0.81, marking the weakest reading in more than 30 days and indicating bearish positioning
- Funding rates flipped into negative territory at -0.0081%, indicating short sellers are compensating long positions
- The memecoin maintains a $1.5 billion market capitalization with an aggregate supply exceeding 420 trillion tokens
Canary Capital submitted an S-1 registration document to the U.S. Securities and Exchange Commission on Wednesday, requesting authorization to establish a spot exchange-traded fund for Pepe. This proposed fund would monitor the valuation of PEPE, the amphibian-themed memecoin that debuted in April 2023.
The announcement failed to generate upward momentum for PEPE’s valuation. The digital asset declined 4.58% during Wednesday’s session and continued its descent into Thursday, settling beneath the $0.0000036 threshold.
Canary Capital has established itself as an aggressive player in the memecoin ETF sector. Throughout the previous year, the investment firm submitted applications for exchange-traded funds monitoring MOG and Pengu, positioning itself among the limited number of asset management companies advocating for products connected to niche, meme-oriented cryptocurrencies.
The registration document acknowledges that PEPE offers no functional purpose. The token operates exclusively as a speculative investment vehicle with an aggregate supply surpassing 420 trillion units.
Should the ETF receive regulatory approval, institutional investors would gain access to 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 Momentum
Blockchain analytics from CryptoQuant indicate conflicting market conditions with emerging bearish indicators. Derivatives market movement suggests selling pressure dominates current trading.
PEPE’s long-to-short ratio on CoinGlass declined to 0.81 on Thursday. This represents the most pessimistic level observed in more than thirty days. When this metric falls below 1.0, it demonstrates that more market participants are positioning for price depreciation rather than appreciation.
Funding rates simultaneously transitioned into negative territory, registering -0.0081% on Thursday. Negative funding rates indicate that traders holding short positions are compensating those holding long positions — a clear indication of bearish sentiment within perpetual futures markets.
Significant whale transaction activity was detected across both spot and derivatives platforms, which certain market observers interpret as moderately encouraging. Nevertheless, the prevailing market sentiment continues to skew cautious.
Critical Price Thresholds
PEPE momentarily surged past its 50-day Exponential Moving Average at $0.0000036 during Tuesday’s trading, registering gains exceeding 11%. The token failed to maintain this elevation and retreated the following session.
Should downward price momentum persist, the immediate support zone resides at Tuesday’s intraday low of $0.0000033. A decisive breakdown beneath this threshold could propel PEPE toward the February 6 bottom at $0.0000031.
The Relative Strength Index on the daily timeframe currently registers 50 and exhibits downward trajectory, signaling diminishing buying momentum. The MACD indicator continues to display a bullish crossover pattern established during the previous week, which remains technically 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.
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