TL;DR
- Continuous token burns enhance SHIB’s scarcity, creating potential for long-term value growth.
- Technical and market trends also suggest SHIB might be poised for recovery despite recent declines.
Time for Rebound?
The cryptocurrency sector endured a severe correction in the past 24 hours, with Shiba Inu (SHIB) being among the losers. Its price tumbled by over 12%, while its market capitalization briefly dipped below $15 billion.
However, some essential factors suggest that SHIB might return to the upward trend soon. One example is the meme coin’s burn rate, which skyrocketed by more than 1,000% on a 24-hour scale, resulting in approximately 51.7 million tokens being destroyed.
The USD equivalent of the stash might be insignificant, but continuous efforts in that field will reduce the circulating supply of Shiba Inu, potentially making it more valuable (assuming demand remains the same or heads north). Since adopting the program, the SHIB team and community have burned over 410.7 trillion tokens, leaving around 589.3 trillion in circulation.
The second bullish element is Shiba Inu’s Relative Strength Index (RSI), which recently plunged below 30. The technical analysis tool measures the speed and change of price movements and varies from 0 to 100. Readings below 30 typically indicate that the asset is underbought, suggesting a higher likelihood of a potential rebound. On the other hand, anything above 70 suggests a possible correction.
Last but not least, we will touch upon SHIB’s exchange netflow, which has been negative for the past three days (according to CryptoQuant’s data). This is considered bullish since it signals a potential shift from centralized platforms towards self-custody methods, hence reducing the immediate selling pressure.
Bonus: Shibarium’s Advancement
Shiba Inu’s layer-2 scaling solution – Shibarium – made the headlines earlier this week when it blasted through another milestone. As CryptoPotato reported, the total number of wallet addresses surpassed two million.
Over the past several weeks, the network has been processing daily transaction into the millions, with their total number currently standing at over 630 million.
Shibarium’s increased activity may attract new developers and users, which could bolster the overall visibility and adoption of SHIB.
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