The popular memecoin, Shiba Inu (SHIB), has recently garnered considerable attention in the cryptocurrency market due to a dramatic surge in its token burn rate. Shibburn, a platform that monitors SHIB token burns, reported an extraordinary 16,600% increase in the burn rate, igniting speculation about a potential price recovery despite a current decline in SHIB’s value.
Why Is the Token Burn Rate Increasing?
The Shiba Inu community has taken significant steps by burning SHIB tokens worth $21.5 million, reducing the circulating supply and potentially boosting the token’s value. Over the past 24 hours, a notable 16,593% increase in the burn rate was recorded, with community members collectively burning 21.5 million SHIB through multiple transactions. A wallet address starting with 0x498 played a major role by transferring 21.31 million SHIB to a dead wallet in a single transaction.
Can Price Recovery Follow?
Despite the substantial burn, SHIB’s price has fallen below the crucial support level of $0.000024, moving away from the resistance level at $0.000025. Currently, SHIB’s price is down by 3.30% in the last 24 hours, standing at $0.00002392 with a market capitalization of $14.09 billion. However, trading volume has surged by 42.35% to reach $659.67 million.
Key Takeaways for Investors
- A significant increase in SHIB’s token burn rate may lead to a price uptick if demand remains steady or rises.
- Despite the token burn, SHIB’s price is currently experiencing a downward trend.
- An essential level to watch for potential price recovery is $0.000025, with possible targets at $0.000030 or $0.000050.
- Derivative market data shows a decrease in open interest for SHIB futures, indicating reduced enthusiasm among derivative traders.
Although the rising token burn rate has instilled a sense of optimism within the Shiba Inu community, surpassing the $0.000025 level is crucial for a significant price recovery. If successful, SHIB could aim for higher targets. In contrast, the derivatives market presents a more cautious outlook, with declining open interest and increased long liquidations suggesting potential further declines.