THE Shiba Inu (SHIB) The price has remained low for a while now, with the second largest meme coin by market capitalization still below the crucial price level of $0.00002. unimpressive price action This is due to several factors, including the weak price movement of Bitcoin.
Why Shiba Inu Price is Falling
The price of Shiba Inu has been on a downward trend mainly due to its strong positive price correlation with Bitcoin. Data from market intelligence platform IntoTheBlock shows that Shiba Inu’s price correlation with Bitcoin is currently at 0.94 and is approaching its peak at 1. As such, the meme coin’s price is mimicking the flagship cryptocurrency’s price action.
Related Readings
Bitcoin has struggled in recent days to hold above the $60,000 support level, and Shiba Inu Bitcoin is also in a similar situation as it continues to oscillate below and above the $0.000014 price level. The weak Bitcoin price movement has been attributed to the significant slowdown in its demand growth, which can also be said about Shiba Inu.
Other data from IntoTheBlock shows that interest in the meme currency has been declining for some time, even among whales. Large Shiba Inu transactions have remained flat and bearish, highlighting the lack of confidence among these Shiba Inu Whales have in the trajectory of the same part.
These whales have played a vital role in keeping the price of the Shiba Inu afloat, especially since there has been a lack of new investors in the meme currency ecosystem. Daily new addresses on Shiba Inu have continued to fluctuate between 1,000 and 2,000 over the past three months. Meanwhile, the total number of addresses with a balance has remained around one million since the beginning of the year.
With such a bearish outlook, Shiba Inu price is undoubtedly at risk of falling further. The meme coin could plummet if Bitcoin fails to recover and hold above $60,000 soon enough. This could also trigger a massive wave of selling, as over 52% of Shiba Inu Owners are currently out of the money, leading to further downward pressure.
A bright spot in the midst of the storm
THE Shibarium layer 2 network The network saw a massive spike in daily transactions, from 1,740 to 28,680 on August 20. This is a significant development considering that the network’s daily transactions have been hovering between 1,000 and 4,000 over the past 30 days. Shibarium’s Daily Transactions have also decreased significantly since the beginning of the year.
Related Readings
It remains to be seen, however, whether this increase recorded on August 20th marks the beginning of an increase in daily transactions on the network. If so, this could have a positive impact on the price of Shiba Inu since network activity has increased on Shibarium leads to more Shiba Inu burnsultimately affecting its price.
At the time of writing, Shiba Inu is trading at around $0.00001375, down over the past 24 hours, according to data from CoinMarketCap.
Featured image created with Dall.E, chart by Tradingview.com
