Shiba Inu burns 798M tokens – Is this next for SHIB’s price now?

    SHIB’s weekly burn supply jumped by nearly 4x.
    SHIB’s on-chain activity plunged, with less influx of new users.

Approximately 24 million SHIB tokens were removed from circulation within the past day, contributing to the ongoing intense burn rate for this popular meme currency.

SHIB burns, but price goes the other way

In their latest announcement, X (previously Twitter) revealed that the amount of supply burned surpassed the figure from the previous day by more than 90%. This equates to an astonishing 798 million tokens being destroyed over the past week, representing a nearly fourfold increase compared to the previous week.

Crypto projects have been drawing attention with the practice of token burning, which involves permanently removing coins from circulation to boost their worth over time.

The removal creates a supply shock, which when matched by robust demand, could boost prices.

Despite SHIB‘s unfortunate dip, losing 20% of its value over the past week based on CoinMarketCap data, it is evident that the coin’s demand has been weak lately.

SHIB sees sharp fall in network activity

These deductions were supported by SHIB’s on-chain activity.

Based on Santiment’s analysis, reported by AMBCrypto, there was a significant drop of over 50% in the number of distinct cryptocurrency wallets participating in SHIB transactions during the past week.

On the seventeenth of April, the number of new addresses generated decreased significantly. Only approximately 862 new addresses were formed, which is nearly half of the number generated in the previous week.

The low rate of network growth meant that the coin wasn’t gaining enough traction.

Shiba Inu burns 798M tokens – Is this next for SHIB’s price now?

SHIB in the derivatives markets

The price slump also dented speculative interest for the coin.

Read Shiba Inu’s [SHIB] Price Prediction 2024-25

Using data from Coinglass, AMBCrypto observed that open interest in SHIB futures contracts decreased by 38% over the past week and dropped by over 55% since the beginning of the month.

Shiba Inu burns 798M tokens – Is this next for SHIB’s price now?

In other words, a large number of SHIB derivatives traders held bullish bets based on the data from the Longs/Shorts ratio which was greater than 1 at that time.

Read More

2024-04-18 08:07