Shiba Inu (SHIB), the second-largest meme coin, has dropped to $0.00001162. This decline marks a 65% fall from November’s peak. The broader meme coin market has also suffered, with Dogecoin falling 22% in 30 days. Other coins like Pepe, Bonk, and Floki have lost over 25%, reflecting weak sentiment in this sector.
Meme Coins Struggle as Shiba Inu’s Burn Rate Declines
SHIB’s burn rate has crashed by 88% in 24 hours, according to Shibburn data. Fewer than 25 million SHIB tokens, worth less than $400, have been burned this week. This decline suggests reduced community engagement and a lack of strong deflationary pressure.
Meanwhile, Shibarium, Shiba Inu’s Layer 2 network, is struggling. Total completed transactions approach 900 million, yet the number of addresses remains stagnant at 2.1 million. Additionally, fees collected on the network and the total value locked (TVL) in its DeFi ecosystem have dropped below $2.5 million. ShibaSwap, WoofSwap, ChewySwap, and Marswap have all seen TVL decline by more than 30% in the past month.
Futures Open Interest Signals Weak Investor Demand
Investor interest in Shiba Inu futures has also weakened. Open interest has dropped to $182 million from its year-to-date peak of $542 million. This decline indicates reduced speculation and a lack of strong trading activity. With fewer traders betting on SHIB, its price faces further downside risk.
Technical Indicators Confirm a Bearish Outlook
On the daily chart, SHIB has formed a death cross. This bearish pattern occurs when the 50-day moving average crosses below the 200-day moving average. Historically, this signals a continuation of a downtrend. The last time SHIB formed a death cross in June 2023, its price dropped by over 40% in the following weeks.
SHIB has also developed a bearish pennant pattern, hinting at more losses ahead. If the price falls below $0.00001162, it may decline to $0.00008480. That drop would represent a 45% decline from the current price.
Is There Any Hope for SHIB’s Recovery?
Despite bearish signals, SHIB could see short-term rebounds if market sentiment shifts. However, weak burn rates, low DeFi activity, and declining futures interest make recovery difficult. Traders should watch the $0.00001162 support level closely. If SHIB stays above this level, a bounce toward $0.000015 could occur. Yet, a drop below this threshold may lead to deeper losses.
In conclusion, Shiba Inu remains in a bear market with no immediate signs of recovery. Its burn rate has dropped significantly, while Shibarium’s DeFi ecosystem is underperforming. Futures open interest has declined, reflecting weaker investor confidence. The formation of a death cross and a bearish pennant further confirm downward momentum.
Read Also: Shiba Inu (SHIB) Soars 8%—Why Experts Say This Crypto Surge Is Just Beginning
SHIB traders should stay cautious. A breakdown below $0.00001162 could trigger another sharp sell-off. However, if SHIB manages to hold above this level, a short-term bounce remains possible.
