Shiba Inu (SHIB) is making headlines again, thanks to a huge increase in activity from big-money investors, known as “whales.” This could mean a big price jump for the meme coin is on the horizon.
Whale Watching: A 240% Surge in Large Transactions
Data from IntoTheBlock shows a massive spike in large transactions involving Shiba Inu. On August 11th, the volume of these transactions jumped by a whopping 240%, reaching 781.4 billion SHIB. The next day, the volume continued to climb, increasing by over 93% to 1.51 trillion SHIB.
This surge in activity suggests that whales are buying up Shiba Inu, hoping to capitalize on its potential to rise back above the $0.00002 price level. They likely took some profits during the recent market crash but are now returning to the game as the market recovers.
A Bullish Sign: SHIB’s Correlation with Bitcoin
Another positive sign for Shiba Inu is its strong correlation with Bitcoin. Currently, SHIB’s price is closely tied to Bitcoin’s, with a correlation coefficient of 0.79. This means that as Bitcoin climbs, Shiba Inu is likely to follow suit.
Not All Good News: Some Red Flags Remain
While the whale activity is promising, some on-chain metrics suggest caution. The net network growth for Shiba Inu has stalled, indicating a lack of new investors. Additionally, over 52% of SHIB holders are currently underwater, meaning they bought the coin at a higher price. If these holders decide to sell once they break even, it could put downward pressure on the price.
Burning Away: A Boost from Shibarium
On the positive side, Shiba Inu’s burn rate has skyrocketed by over 573% in the past week. This means that over 151 million SHIB tokens have been permanently removed from circulation. This surge in burning is likely due to the transition of Shibarium, Shiba Inu’s layer-2 network, to an automated burn mechanism. This means that 70% of transaction fees on Shibarium will be automatically converted to SHIB and burned.
However, Shibarium’s network activity has slowed down since the beginning of the year. For the burn rate to continue at its current pace, Shibarium needs to see a resurgence in activity.
The Bottom Line
Shiba Inu is showing signs of life, with whales returning to the market and a potential boost from Shibarium. However, some caution is warranted, as the net network growth has stalled and a significant portion of holders are underwater. Ultimately, the future of SHIB will depend on a combination of factors, including whale activity, Bitcoin’s performance, and the success of Shibarium.
