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The community of Shiba Inu (SHIB), which has declared itself the “Dogecoin killer,” is troubled by speculation of a downturn following a significant drop in the altcoin‘s price. The price of the meme-based altcoin, which saw a notable rise in the past weeks, fell below the $0.00003 level, causing anxiety among investors. The current downward trend in SHIB’s price coincided with a weekly decrease in the token burn rate and followed the general downtrend in the memecoin market.
Token Burn Rate Drops by 60 Percent
Despite the Shiba Inu community burning over 339 million tokens last week, SHIB’s weekly token burn rate plummeted by 58.96%. This drop mirrors the altcoin’s 7.60% decrease in weekly price, suggesting a correlation between token burn rate and price movement. While the community continues to burn a significant amount of SHIB, the altcoin’s price decline has led to speculation about market dynamics.
Interestingly, SHIB’s burn rate increased by about 100% in the last 24 hours, with 33 million tokens being burned. However, despite this increase in token burn activity, investor sentiment continued to trend downward, and price charts indicated bearish dominance. At the time of writing, SHIB was trading at $0.00002715, down by 0.06% in the last 24 hours.
Warning Bells Ring
Although Shiba Inu’s SHIB price chart potentially shows a gradual increase in momentum due to recent rises, market dynamics continue to fuel speculation about the altcoin’s future.
Weekly market data shows a decline of about 7%, indicating more potential downsides for SHIB. Derivative data reveals a 1.61% decrease in SHIB’s open interest and a 4.41% drop in trading volume, suggesting reduced market activity and low new money inflow contributing to SHIB’s downward trend.
Moreover, the OI weighted funding rate fell to 0.0198%, reflecting a decrease in investor sentiment towards opening long positions in SHIB. The Relative Strength Index (RSI) is hovering around 53, indicating neither overbought nor oversold conditions for the altcoin, while the observed downtrend over the past week, combined with the decrease in open interest and trading volume, suggests potential for further price declines amid a weakening market momentum after a memecoin rally.
