The newly launched PENGU token from Pudgy Penguins has captured the attention of the crypto world. However, its rapid ascent and signs of volatility raise questions for cautious traders.
PENGU Token Launch and Market Reaction
The Solana-based PENGU token reached an astonishing $2.3 billion market cap within just an hour of its launch. In the first day after its release, the token soared approximately 600%. Trading activity was equally explosive with a 24-hour trading volume of $2.57 billion, surpassing its market cap.
Volatility Issues and Risks for Traders
Despite the excitement, PENGU's meteoric rise comes with risks. Newly launched tokens often experience a trading volume that exceeds their market cap, which may signal potential instability. Professionals advise exercising caution in the early days after launch, as excessive trading activity can lead to heightened volatility and significant price swings.
Token Distribution and Its Impact on the NFT Market
As part of the PENGU rollout, 23.5% of the total supply was airdropped to Pudgy Penguin NFT holders, 22% was reserved for Solana and Ethereum communities to encourage cross-chain interaction, and 12.3% was added as liquidity on decentralized exchanges. This has contributed to a 2.6% rise in the Pudgy Penguins collection floor price to 34.1 ETH ($136,000).
The PENGU token shows significant growth, yet traders should be mindful of volatility signals and potential risks when trading. Steady distribution and community support can play a key role in the token’s future.
