Shiba Inu (SHIB), the popular dog-themed meme coin, is experiencing conflicting signals amidst the recent crypto market slump. While the burn rate, a metric indicating the rate at which tokens are permanently removed from circulation, skyrocketed by over 4,000% in the past 24 hours, the token’s price continues to decline.
This surge in burning activity, primarily attributed to the destruction of over 154 million SHIB tokens, has ignited a spark of optimism within the SHIB community. The burning process aims to reduce the overall supply of SHIB, potentially leading to scarcity and a subsequent price increase. Additionally, the community burning large amounts of tokens signifies their confidence in the project’s future.
In the past 24 hours, there have been a total of 154,999,579 $SHIB tokens burned and 4 transactions. Visit https://t.co/t0eRMnyZel to view the overall total of #SHIB tokens burned, circulating supply, and more. pic.twitter.com/rhajRJLTud
— Shibburn (@shibburn) April 3, 2024
Shiba Inu Price Sluggish Despite Massive Burn
However, despite the burning frenzy, the current market sentiment seems to be dictating SHIB’s price more heavily. As of today, April 3rd, SHIB is trading around $0.000026, reflecting a significant drop. This price correction aligns with the broader crypto market downturn, suggesting that external factors are currently outweighing the burn rate’s potential impact.
Further dampening investor spirits is a decline in trading activity. Data suggests a decrease in open interest, which indicates the number of outstanding SHIB futures contracts, and a drop in derivatives volume, both pointing towards reduced investor participation. This lack of enthusiasm could further hinder any immediate price recovery.
SHIB market cap currently at $16.5 billion. Chart: TradingView.com
Last week, Shiba Inu (SHIB) experienced a 12% price decline on a weekly basis, trailing behind other popular tokens such as Dogecoin (DOGE). Despite this setback, there is optimism for SHIB’s future growth, as noted by analyst Captain Faibik (CryptoFaibik on X). Referring to data from a 6-hour chart, the analyst points out the formation of a symmetrical triangle, a pattern considered bullish by traders due to its characteristic of lower highs and higher lows.
Typically, during a consolidation period, the asset price in a symmetrical triangle will fluctuate within narrower levels. The market is typically showing signs of hesitation when this happens.
The Road Ahead For SHIB
Looking ahead, analysts are divided. Some crypto enthusiasts believe the ongoing burning will eventually lead to a scenario where buying pressure overwhelms the selling pressure, driving the price up. However, if the broader market weakness persists, SHIB could revisit its Fibonacci retracement level of $0.00002368.
The recent burn rate surge offers a glimmer of hope for SHIB’s long-term prospects. The current market climate and reduced investor interest pose significant challenges, and any price predictions in the highly dynamic crypto space remain inherently uncertain.
Featured image from Pexels, chart from TradingView
