Shiba Inu (SHIB), the popular meme-based cryptocurrency, continues to trade within a narrow range, clinging to a crucial support level amid heightened token-burning activity. As of Tuesday, SHIB was priced at $0.00001192, remaining relatively flat over the past few sessions and sitting nearly 75% below its 2024 peak.
SHIB Holders Face Mounting Losses
The ongoing decline in Shiba Inu’s price has dramatically eroded profits for investors. According to blockchain analytics firm Santiment, only 20% of SHIB holders remain in profit — a stark contrast from the 91% peak seen just months ago. This significant shift underscores the broader market weakness and investor uncertainty plaguing the token.
SHIB Burn Rate Spikes 3,206%
Despite the bleak price action, on-chain data indicates that Shiba Inu’s burn mechanism is accelerating. According to Shibburn, the daily burn rate jumped by an eye-popping 3,206%, with over 30.1 million SHIB tokens incinerated in a single day. Among the notable contributors, one wallet sent 14.5 million tokens to a burn address, while another burned 8.3 million.
This deflationary mechanism sets Shiba Inu apart from other meme coins such as Dogecoin (DOGE), Pepe (PEPE), and Fartcoin (FARTCOIN). Unlike its rivals, SHIB is designed to reduce supply over time, and its annual deflation rate now stands at -0.0059%. To date, more than 410 trillion tokens have been burned, with roughly 584 trillion SHIB still in circulation.
Shibarium’s Role in the Burn Momentum
Supporting SHIB’s burn narrative is the growth of Shibarium — Shiba Inu’s Layer-2 blockchain. According to Shibarium Scan, the number of addresses on the network has surged to 197.45 million and is expected to surpass 200 million later this month. Additionally, over 1.047 billion transactions have been recorded on the network.
Shibarium plays a pivotal role in the SHIB ecosystem as a portion of BONE transaction fees is converted into SHIB and sent to a burn address. As network activity increases, so too does the pace of token burns — potentially improving the token’s long-term value proposition.
Technical Outlook: Price at a Critical Juncture
From a technical perspective, SHIB is teetering at a make-or-break level. The weekly chart shows that the token has steadily declined from its November high of $0.00003335 to its current price near $0.000012. This level aligns with an ascending trendline that has consistently provided support since 2021 — a trendline SHIB has failed to break on six separate occasions.
Moreover, this zone coincides with the neckline of a prominent double-top formation, last seen in August 2023. If bears manage to push SHIB below this critical support, the token could tumble toward $0.000005840 — the lowest swing level from June 2023 — marking a further 50% downside from current prices.
Final Thoughts
Shiba Inu’s fundamentals remain compelling, bolstered by an aggressive burn strategy and growing Layer-2 infrastructure. However, until the token can decisively defend its current support or break above key resistance zones, its near-term outlook remains precarious.
Investors will be closely watching whether the surging burn rate can act as a catalyst or if SHIB will slide further into bearish territory.
