The Shiba Inu Ecosystem Struggles to Attract New Users
Despite the recent crypto market rally, Shiba Inu (SHIB) has seen its price remain stagnant at around $0.000007. This lackluster performance is not unique to SHIB, as other memecoins like Dogecoin (DOGE), PEPE, and BoneShibaSwap (BONE) have also experienced similar outcomes. Investors seem to be shifting their focus to emerging sectors like Real World Assets (RWA) and Telegram Bot tokens. The question now is how this change in investor behavior will affect SHIB’s price in the coming weeks.
Decline in Network Demand Affects SHIB Price
One of the reasons for SHIB’s poor price performance is the decline in network demand. On-chain data from Santiment shows that since reaching its peak price of $0.000011 on August 12, SHIB has struggled to attract new users. The number of new SHIB wallet addresses created daily has dropped by 66%, from 3,269 addresses on August 12 to only 1,109 addresses on September 17. This decline in user acquisition indicates a lack of new demand for SHIB, which has contributed to its stagnant price.
Existing Network Participants Book Profits Intermittently
In addition to the decline in network growth, existing SHIB holders have started to book profits intermittently. This can be seen through the significant spikes in Age Consumed, a metric that measures changes in the trading activity of long-term holders. Whenever Age Consumed exceeds 150 trillion, SHIB price tends to experience a sharp retracement. For example, on September 4 and 11, Age Consumed surpassed this threshold, leading to significant price drops. These spikes indicate that many long-term holders are selling their SHIB tokens to avoid further losses.
Consolidation at the $0.000007 Range
Based on on-chain analysis, it is likely that SHIB’s price will continue to struggle to break out in the coming days. However, it will also be challenging for bears to push the price below the $0.000007 support level. The In/Out of Money Around Price data shows that a significant number of SHIB holders bought tokens at this price, and they may choose to hold onto them rather than sell if market sentiment remains positive. If the bears do manage to break this support level, SHIB’s price could retrace towards the $0.000006 range. On the other hand, if network demand grows, the bulls could gain momentum and push towards the $0.000010 resistance level.
Hot Take: Shiba Inu’s Price Struggles Amidst Crypto Rally
The recent stagnation of Shiba Inu’s price amidst a broader crypto market rally can be attributed to a decline in network growth and existing participants booking profits. With fewer new users joining the ecosystem and long-term holders cashing out, SHIB’s price has remained stagnant. Unless there is a reversal in this trend, Shiba Inu and other memecoins may continue to underperform in the coming weeks. However, if market sentiment remains positive and network demand increases, there is a possibility for SHIB’s price to break out and reach higher resistance levels.
By
By
By
By
