PEPE Long on Hyperliquid DEX Generates 734% Weekly Return as Meme Coin Market Struggles

A long position in Pepe (PEPE) on Hyperliquid’s decentralized exchange (DEX) has reportedly generated a 734% return over the past week. This performance contrasts with broader bearish sentiment in the meme coin market, where most tokens face sustained selling pressure and uncertainty in 2026 according to data. On-chain data suggests whale activity has further intensified the divergence between DOGE and smaller meme coins like PEPE and SHIB.

Pepe, DOGE, and SHIB have struggled to recover in the New Year as Bitcoin remains under pressure. A 2% to 4% decline in early January has raised concerns about long-term bearish trends. Whale investors are increasingly concentrating their holdings in DOGE while reducing exposure to SHIB and PEPE, reflecting a shift in confidence.

Whale activity data from Santiment shows a notable increase in DOGE holdings, with large wallet investors accumulating 100 million to 1 billion tokens. At the same time, PEPE and SHIB whale holdings have declined. Whale exposure to SHIB dropped to 11.06 trillion tokens from 11.12 trillion, and PEPE holdings fell to 4.45 trillion from 4.47 trillion in the same period according to reports.

What Explains the Strong Return on PEPE on Hyperliquid?

Hyperliquid’s DEX reported $3.09 billion in 24-hour trading volume as of January 4, making it the leading platform for perpetual contracts. The platform’s open interest rose by 10% week-over-week to $7.77 billion, indicating strong liquidity and market participation according to platform data.

The PEPE long position that yielded a 734% return was likely executed on this platform, leveraging its deep order book and active trading environment. This suggests Hyperliquid is attracting aggressive traders seeking high-risk, high-reward opportunities in meme coins.

What Drives the Bearish Trend in Meme Coins?

Meme coins remain vulnerable to market sentiment shifts and supply-side pressures. DOGE, for instance, is approaching a key support level near $0.1111 on the daily chart after a six-week decline. A break below this level could threaten the $0.1000 psychological threshold according to technical analysis.

The RSI for DOGE is at 33, signaling intense selling pressure and limited near-term upside. The MACD is also in a bearish phase, with red histogram bars indicating a fresh cycle of bearish momentum according to technical indicators.

What Do Analysts See as Risks in 2026?

Analysts highlight the growing regulatory clarity and institutional adoption of crypto assets, such as XRP ETFs, as potential tailwinds for the sector in 2026. However, meme coins remain speculative, with their performance heavily dependent on social media sentiment and whale behavior according to market analysis.

The volatility in 2025—marked by a 61% drop in meme coin market cap—suggests investors must exercise caution. With new tokens launching daily and AI-driven trading strategies emerging, the landscape is evolving rapidly according to industry reports.

Experts also warn of market manipulation incidents, such as the recent BROCCOLI(714) incident on Binance, where a hacker manipulated prices to generate $1 million in profit. These events expose vulnerabilities in exchange controls and highlight the need for robust risk management tools.

What Are the Long-Term Implications for Meme Coins in 2026?

While meme coins remain speculative, some analysts see potential for a rebound if Bitcoin rallies as projected. A $120,000 to $170,000 price target for BTC in 2026 could provide a lift to the broader crypto market according to market forecasts.

Solana is also expected to dominate meme coin activity in 2026, driven by its low-cost infrastructure and Pump.fun’s role in token creation. This could shift the narrative from pure speculation to utility-driven use cases according to industry analysis.

What Do Investors Need to Watch Closely?

Investors should monitor whale activity, technical indicators, and regulatory updates in 2026. The 2026 U.S. midterm elections could also trigger volatility in PolitiFi-related tokens, as seen in the Trump (TRUMP) token launch according to market data.

Additionally, prediction markets and AI-driven strategies are expected to influence meme coin trading. Meme coins could serve as underlying assets for prediction platforms, enabling investors to bet on outcomes like PEPE’s performance against DOGE according to industry trends.

The risks of trading on margin and using leveraged contracts remain high, especially in volatile markets like meme coins. Investors are advised to allocate only capital they can afford to lose and to implement disciplined risk management strategies.