Market fluctuations on October 11th triggered a chain reaction, leading to a significant tightening of liquidity. In such an environment, market participants' choices have undergone interesting shifts—funds are beginning to flow from major coins to small-cap targets, with MEME coins like PEPE defying the trend and gaining strength, driven by deeper market logic.

1. Cost Difference-Driven Capital Flows

Currently, market liquidity is under pressure. As the largest market cap asset, BTC requires a huge amount of capital to move its price. In contrast, altcoins and MEME coins, due to their smaller market caps and limited trading depth, can experience significant price fluctuations with relatively small amounts of capital. This makes small-cap coins naturally attractive targets for funds seeking breakout opportunities in a liquidity-constrained environment.

It is worth noting that the shock on October 11th has thoroughly cleaned out previous trapped positions. Many altcoins did not follow BTC to new lows, reflecting that support levels below are relatively solid, and market structure has shown positive changes.

2. Market Appeal of PEPE

As a well-known MEME coin with a relatively low market cap, PEPE's token structure has become lighter after a long adjustment period. Compared to high-market-cap assets, a small increase in capital can drive prices higher, which is attractive to participants seeking high elasticity returns.

The unique aspect of MEME coins lies in their community-driven nature and topical attributes. During periods of market sentiment volatility, such coins often gather attention and participation, creating emotional resonance.

3. Reflection of Market Participant Behavior

From a market perspective, the flow of funds from large-cap to small-cap reflects participants' reassessment of risk-reward ratios under liquidity constraints. This phenomenon occurs during various market stress periods and is part of the market's self-regulation process.

In the short term, the performance of such coins depends on whether they can attract sustained attention and capital participation. Long-term investors need to evaluate rationally, avoid chasing highs, and focus on fundamental support.