Is PEPE Correlated More to Ethereum or Market Liquidity Cycles?

[madmax]

While PEPE is technically an ERC-20 token, its price action correlates more strongly with global liquidity conditions than with Ethereum’s fundamentals. PEPE often outperforms during periods of stable ETH price action combined with expanding leverage and speculative capital rotation.

This makes PEPE less useful as an ETH beta play and more effective as a liquidity expansion indicator. When PEPE begins outperforming ETH on a risk-adjusted basis, it often signals that traders are reallocating from majors into higher-risk assets.