- SHIB clings to key support as investor sentiment weakens, and only 20% remain in profit.
- Token burn accelerates with over 30M SHIB destroyed, boosting deflationary strength.
- Shibarium’s rapid growth supports long-term value, but a breakdown risks a sharp decline.
Despite a surge in Shiba Inu’s token burn rate, the memecoin is close to a crucial support level. Despite the token being flat in terms of price for several consecutive sessions, it traded at $0.00001162 as of now. Its peak further in 2024 has led to a 75% decline in this level.
Data from Santiment shows that there has been a noticeably gradual decline of investor sentiment, which today stands at just 20% of SHIB holders on profit, from a high of 91% a few months ago. As the memecoin is still struggling to gain upward momentum, most of the wallet addresses have been underwater in the extended downturn in price.
SHIB Burn Rate Surges as Supply Shrinks
However, in terms of Shiba Inu’s tokenomics, the active deflationary efforts have not been affected by the price pressure. Data from Shibburn indicates an overall increase in token-burning activity. The traded volume increased by 2,671%, and over 30.1 million SHIB tokens were destroyed. One of these sent 14.5 million tokens to a designated burn address; the second user used a wallet to remove 8.3 million tokens from circulation.
Currently, there is no major deflationary asset in the meme coin ecosystem other than that of Shiba Inu and that makes it stand out. The coin has now hit its long term scarcity model by having an annual deflation rate of -0.0059%.
As of the time of writing, more than 410 trillion SHIB tokens have been permanently removed from the supply flow, which means the overall circulating amount is only about 584 trillion. The trend will continue to burn with the Shibarium network that is designed to scale by reducing the costs of transactions as well as increasing the speed.
Shiba Inu Holds Critical Support Amid Prolonged Bearish Trend
Shibarium Scan data shows that the network has had more than 1.047 billion transactions and has roughly 197.45 million addresses. Before the month ends, that number is expected to cross the 200 million mark. In addition, a portion of every transaction fee paid in BONE (the governance token of the Shibarium ecosystem) converts into SHIB, and they burned so we have deflationary press.
On the technical front, the Shiba Inu weekly chart depicts that Shiba Inu has been in the clutches of long bearish momentum. The token has dropped to its current level as it respects an ascending trendline going back to 2021 since adding a high of $0.00003335 in November. The historical support for SHIB has been demonstrated by its testing of this trendline at least six times now without breaking it.
This price zone is also important for its roll off the August 2023 low that acted as the neckline in the large double top pattern that was made a year ago. If SHIB faces a break below this level, the analysts warn there could be further fall to $0.000005840, the low from June 2023, that will make for an additional 50% drop from the current price.
Of course, Shiba Inu’s price action is as uncertain as it can get, but its on going burn initiative and altogether developing ecosystem can serve as potential long term value drivers for the coin. But for now, SHIB is hanging on to a critical support line and investors are playing it safe.
