Shiba Inu burn rate drops by 61%
Shiba Inu faces severe downside as technical indicators turn bearish.
Shiba Inu (SHIB), the second-largest meme coin by market capitalization, faces severe downside momentum as several technical indicators turn bearish.
As the broader crypto market enters a correctional phase following Bitcoin’s decline, SHIB has seen a 61% drop in its burn rate and trading volume slip below $400 million, reports Bitcoinist.
Key Takeaways
- Burn Rate Volatility: Recent data shows a 61% decline in SHIB’s burn rate over the past 72 hours, though a subsequent 24-hour period recorded a 470% surge, highlighting mixed market signals.
- Falling Trading Volume: SHIB’s trading volume has decreased to $379 million, signaling reduced investor interest amid broader market corrections.
- Broader Market Impact: A drop in Bitcoin’s price below $100,000 and escalating trade war fears have contributed to heightened volatility and bearish sentiment across the crypto market.
- On-Chain Bearishness: On-chain analytics indicate that over 57% of SHIB holders have incurred losses, while only 47% have seen gains, reinforcing the overall bearish outlook.
Declining Token Burn and Trading Activity
One of the key growth drivers for Shiba Inu has been its aggressive token burn strategy, which, since its inception in August 2020, has reduced its initial supply of 999.9 trillion tokens by burning a total of 410.7 trillion tokens.
SHIB price dynamics. Source: coinmarketcap.com
Recently, however, the Shibburn tracker noted a 61% decline in the burn rate over the last 72 hours, a drop that has raised concerns about diminished deflationary pressure. In contrast, a sharp 470% increase in burn rate during the last 24 hours indicates volatile investor behavior and suggests that the market is reacting unpredictably to current conditions.
Impact of Market Corrections and External Pressures
The bearish sentiment surrounding SHIB is further compounded by a broader market correction following Bitcoin’s significant drop below $100,000. This downturn has not only impacted major cryptocurrencies but also led to reduced trading volumes for meme coins like Shiba Inu, which now see volumes dipping below the $400 million mark.
Additionally, ongoing geopolitical tensions—exemplified by the trade war between the United States and China, Canada, and Mexico—have contributed to the overall market volatility, exacerbating investor nervousness and accelerating the decline in SHIB’s key metrics.
Loading...
Technical Indicators and On-Chain Data Signal Caution
Beyond the burn rate and trading volume, several technical indicators point to a bearish outlook for Shiba Inu. The token’s moving averages are firmly in the red, while its Relative Strength Index (RSI) sits at around 31%, suggesting that the momentum remains weak.
On-chain data from IntoTheBlock further underscores this pessimism, revealing that SHIB has experienced a nearly 30% price crash over the past month, with a 20% drop last week and an additional 5.5% decrease in the past 24 hours. Such trends have led analysts to classify SHIB as “mostly bearish,” as a majority of holders are currently in loss positions.
Recently we wrote, that Shiba Inu’s burn rate surged by 567.83% in the past 24 hours, fueling bullish sentiment as the crypto market shows signs of recovery.
