The Shiba Inu token (SHIB), once a hotbed of frenetic on-chain activity, is currently facing a cryptic crash. The data indicates that the burn rate (a mechanism by which tokens are sent to an inaccessible wallet to reduce supply) has plateaued at 0%.
The Shiba Inu token (SHIB), once a hotbed of frenetic on-chain activity, is currently facing a cryptic crash. The data indicates that the burn rate (a mechanism by which tokens are sent to an inaccessible wallet to reduce supply) has plateaued at 0%.
From a technical analysis standpoint, SHIB appears to be forming an ascending triangle pattern on the daily chart, characterized by a flat upper trend line serving as resistance and a rising lower trend line acting as support.
This pattern is traditionally considered a bullish indicator and typically resolves with a bullish breakout. For SHIB, the upper trend line of the triangle is located near the $0.0000096 level. A decisive close above this resistance could potentially catalyze an increase in price as it would mean the end of the consolidation and the beginning of a new uptrend.
However, the dichotomy between chart pattern and chain data presents a conundrum. While the technical data suggests an imminent bullish move, the lack of on-chain activity raises questions about the driving force behind any potential price surge. The burn rate stagnation is particularly disconcerting, as token burning is often used to create deflationary pressure and can be a sign of a vibrant ecosystem.
One hypothesis for the drop in on-chain activity could be a change in investor sentiment, possibly due to a broader market slowdown or emerging narratives within the crypto space that have diverted attention away from meme tokens like SHIB. Additionally, the community-driven aspect of SHIB burning mechanisms may be experiencing a pause, reflecting a possible decline in community participation.
It is also worth considering external factors such as regulatory scrutiny or platform-specific issues that could be impacting transaction volumes. With no clear catalyst for the decline in on-chain activity, guessing is our only option at this time.
