The Shiba Inu recently embarked on a vicious token burning campaign, causing much excitement among the SHIB army. Could this campaign help the price rally from its lower support levels, as many had hoped?
Despite their bearish undertones, meme tokens often carve out a powerful niche in the cryptocurrency market, favoring gains and rallies. With current developments centered around the Shiba Inu ecosystem, SHIB, the second largest memecoin by market capitalization, is expected to move in a positive direction.
The question, for now, however, remains whether its recent developments can jolt SHIB’s price with some much-needed bullish momentum.
A Shiva will burn until the price rises?
Shiba Inu hodlers have been dreaming of a price rally since August 15, when MemeCoin surged nearly 45% in just four days.
So last week, when supposed Shiba Inu founder and lead developer Shaytoshi Kusama announced an aggressive token burn campaign, investors expected yet another rally.
As of September 22, the initial supply has burned a total of 410 trillion SHIB, which is over 41% of the highest total supply ever.
In the last 24 hours, at the time of this article’s layout and according to data from Shib Burn, a total of 11.7 million SHIB tokens have been burned through three transactions.
On September 21st, there was a noticeable spike in the token burn rate, where a large amount of SHIB was sent to a dead wallet, causing the burn rate to increase by 1,500%. However, at the time of this writing, and with enthusiasm for the campaign waning, the burn rate has dropped to 83%.
A look at the long-term trend shows that a significant amount of SHIB has been burned, contributing to reduced supply and thus the health of the network. While this decrease in supply should have a long-term bullish effect, will the same be true for token demand?
Shiba Inu supply is dwindling, but what about demand?
Reducing the supply of SHIB when demand increases will ideally lead to a bullish effect on the token. Network Metrics showed a steady increase in daily new addresses, up 1.85% last week. On average, about 1,600 addresses are generated per day in September.
That said, apart from a few notable events in August, when 4,000 new addresses were created, consumer interest in SHIB has not led to major improvements.
In fact, the euphoria of individuals favors price increases when new entities enter the market. In the case of SHIB, in particular, its price increased in October 2021 Then, in February 2022, an increase in new addresses led to a simultaneous increase in prices
Is all this effort in vain?
At the time of this article’s layout, SHIB was trading near the $0.00001078 level, representing a 3.04% gain on the day. Despite a long-term bullish outlook, short-term action appears to be more or less dependent on the market.
Additionally, Shiba Inu’s supply and demand dynamics present significant short-term price constraints before the resource can finally regain strength.
indicator Global in and out of money, notably, showed that the next SHIB supply size barrier is at the $0.000017 level, where 105,000 addresses hold 450 trillion tokens. If the the bull If this manages to push prices above the supply barrier, it could pave the way for further gains.
For now, long-term support located at $0.00001050 has not allowed SHIB’s price to drop further.
Data from IntoTheBlock also shows that over 75% of HODLers were out of line or at a loss during the layout. Overall, however, better dynamics between supply and demand could support Shiba Inu’s growth in increasing demand for this token.
All information on our website is published in good faith and for general information purposes only. Any action taken by the reader based on information found on our website is entirely at their own risk.