Shiba Inu (SHIB) has seen a recent decline in its price, dropping by 9% over the past week according to Coingecko. However, there are several factors indicating that a potential price surge could be on the horizon.
One key factor is the burn rate of SHIB tokens. The burning mechanism, implemented in 2022, involves sending tokens to a null address with each transaction, reducing the circulating supply. Recent data shows a significant increase in the burn rate, with around 60 million tokens destroyed in the past 24 hours. This increased scarcity could potentially drive up the value of the remaining tokens.
Additionally, there has been a notable shift from centralized exchanges to self-custody methods, as indicated by the SHIB exchange netflow. This trend could alleviate selling pressure and boost the price of SHIB, similar to what was observed during a previous bull run in March.
Open interest in SHIB derivatives has also been on the rise, exceeding $30 million last week. This suggests increased market participation and could lead to heightened volatility and significant price movements in the near future.
Furthermore, the progress of Shibarium, a layer-2 scaling solution for the Shiba Inu ecosystem, is worth noting. Since its launch a year ago, Shibarium has achieved significant milestones, processing over 400 million transactions and generating more than 5.5 million blocks. The continued development of Shibarium could have a positive impact on the price of SHIB.
In conclusion, despite recent price declines, there are several reasons to be optimistic about the future of Shiba Inu. Factors such as the burn rate, exchange netflow, open interest, and Shibarium’s progress all point towards a potential price increase in the near future. Keep an eye on these developments for further updates on SHIB’s price movements.