Shiba Inu Sees 144% Spike In Major Metric, But Why Is Price Down?

by

As a researcher with a background in cryptocurrency analysis, I find the recent developments surrounding Shiba Inu (SHIB) intriguing. The significant increase in active accounts and transactions on Shibarium, its layer-2 network, is undoubtedly a positive sign for the meme coin. This growth could potentially lead to increased usage and adoption of SHIB, which can positively impact its price.

Shiba Inu (SHIB), the second-largest meme coin by market capitalization, experienced a notable increase in a key performance indicator recently. This upward trend is typically indicative of a bullish sentiment. However, despite this encouraging sign, the price of Shiba Inu has yet to reflect this positivity in the market. This disconnect between metrics and price action could understandably raise concerns among SHIB token holders.

Shibarium Sees Increase In Active Accounts 

The data from Shibariumscan reveals that the number of active accounts on the Shiba Inu’s layer-2 network surged from 1,290 on April 27 to 3,839 on April 28, marking a significant increase of approximately 144%. This growth is an encouraging sign for Shiba Inu, given that the layer-2 solution has been a crucial factor in the meme coin’s prosperity since its launch last year.

The transaction count on Shibarium noticeably increased from 4,997 on April 27 to 12,191 on April 28. This uptick is particularly positive for Shiba Inu because the volume of SHIB tokens burned through Shibarium is reliant on the number of recorded transactions. Furthermore, there have been other recent encouraging signs for Shiba Inu as well.

NewsBTC recently reported that SHIB’s foremost decentralized exchange (DEX), ShibaSwap, is expanding to Shibarium. This move is expected to increase ShibaSwap’s user base and Shibarium’s, by extension. Shiba Inu will ultimately benefit since an increase in Shibarium’s user base means more transactions, leading to more SHIB burns. 

Why Shiba Inu Is Down

Based on the data from market intelligence platform IntoTheBlock, it’s clear that Shiba Inu’s metrics present an optimistic perspective. However, it’s intriguing why this meme coin has undergone notable price drops recently. One potential explanation is Bitcoin‘s volatility. The correlation between SHIB and Bitcoin currently stands at 0.82%, indicating a “strong positive correlation” between the two assets. This means that when Bitcoin’s price fluctuates, it tends to have a significant impact on Shiba Inu’s pricing as well.

Shiba Inu’s price has followed Bitcoin’s recent downward trend, as Bitcoin undergoes notable price drops. Another contributing factor to Shiba Inu’s price decrease is the decline in large transactions. According to IntoTheBlock, there has been a 4.60% drop in this significant metric.

As an analyst, I’ve noticed that Shiba Inu’s “large investors,” or whales, seem to be taking a step back from their investments in the meme coin. The current market downtrend may be causing them to lose confidence in SHIB. These investors hold significant influence over the price discovery of Shiba Inu, so their confidence (or lack thereof) can have a substantial impact on the coin’s value. Once they regain their trust in the market, Shiba Inu’s price could potentially rebound.

As a researcher studying the cryptocurrency market, I’ve noticed that Shiba Inu’s recent downturn can be attributed in part to a significant decrease in its burn rate. According to data from Shibburn, a prominent platform for tracking SHIB token burns, there has been a 76% reduction in the number of tokens burnt over the past week and a 79% decline within the last 24 hours.

Shiba Inu Sees 144% Spike In Major Metric, But Why Is Price Down?

Read More

2024-05-01 05:11