The launch of Shibarium, a Layer-2 (L2) solution for the Shiba Inu ecosystem, on August 24th has contributed to a positive impact on the altcoin price as it directly affects the use case of BONE Token. Despite the decline in the Shiba Coin price, BONE Token has been the top-gaining altcoin among the top 100 cryptocurrencies. But is the current price at a reasonable level for buying?
The relaunch of Shibarium on the mainnet on August 24th resulted in a price increase for Bone ShibaSwap (BONE), one of its tokens and a Layer-2 (L2) solution for the Shiba Inu ecosystem. According to CoinMarketCap, BONE has gained nearly 20% in value in the past seven days. The increased activity around BONE in recent days is due to some community members regaining access to previously bridged BONE tokens after the relaunch of Shibarium.
When the L2 network went live on August 16th, it experienced scalability issues due to a significant transaction influx. Additionally, there were some issues with the bridge that allowed users to transfer their tokens from other networks to the Shibarium network. This resulted in temporary loss of access to BONE tokens for many community members.
After discovering the issue with the bridge, the Shibarium team halted general access to the network. They later resolved the problem and relaunched the network on August 24th. BONE continues to find buyers at $1.38, but the price readings on the daily chart indicate a weakening momentum despite the rally.
There have been several negative divergences between BONE’s price and some key momentum indicators. For example, while the price of BONE has risen after the relaunch of Shibarium, the RSI and MFI have shown a downward trend. The divergence between price and indicators indicates that the price increase is not supported by strong momentum. This often leads to price declines. If a decline occurs, bulls will have to fight for the psychological support at $1.
While BONE’s price increased last week, its CMF dropped on August 16th and entered the negative zone, where it has remained since then. This also serves as another bearish signal.