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TL;DR
- Shiba Inu (SHIB) may be struggling now, but key indicators point to a potential comeback rally ahead.
- One of the factors is the burn rate explosion on a 24-hour scale.
Ready for Liftoff?
Despite its brief price increase towards the end of March, SHIB has been on an evident decline in the past 30 days. Currently, it trades at around $0.00001192 (per CoinGecko’s data), representing a 5% drop for the timeframe.
However, some essential factors suggest a surge could be just around the corner. SHIB’s burn rate, for instance, has exploded by almost 2,000% in the last 24 hours, resulting in over 17.6 million tokens sent to a null address. Interestingly, a single transaction from a mysterious entity contributed to over 90% of the destroyed stash.
The ultimate goal of the mechanism is to reduce the tremendous circulating supply of SHIB, thus potentially making it more valuable. Burning alone, though, doesn’t guarantee a stable price increase as it also requires a consistent or rising demand.
Next on the list of possible price catalysts is the advancement of Shibarium. In the past weeks, daily transactions processed on the layer-2 blockchain solution have skyrocketed above three million, signaling strong user engagement and increased activity within the ecosystem.
Shibarium supercharges the Shiba Inu ecosystem – slashing fees, speeding up transactions, and burning SHIB along the way. As such, some believe its evolution could ignite fresh momentum for the price of the underlying token. Among the examples is the popular Bitcoin advocate Jeremie Davinci, who said:
“I like Shiba Inu, as you know, and I think it will do relatively well in this cycle, but it may not go as high as you expect. I think Shiba Inu has a lot of utility now that they have Shibarium, and basically, it’s a chain that you can actually run all kinds of applications.
However, nobody is using it, and there are no applications for using your tokens on Shibarium yet. If they get that solved, Shiba Inu will go to the moon.”
Exchange Netflows
SHIB’s exchange netflow is also worth observing. Outflows have been dominating inflows lately, suggesting holders are moving tokens off centralized platforms and into self-custody.
This development could be considered bullish since it reduces the immediate selling pressure. Generally, when investors transfer their crypto holdings to exchanges, it is to dispose of them, and vice versa.
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