Shiba Inu price crashes as whales sell, burn rate slows

Shiba Inu price continued its strong downtrend on Saturday as whale investors sold and sentiment in the crypto industry worsened.

Shiba Inu (SHIB), the biggest meme coin in Ethereum’s (ETH) chain, dropped for four consecutive days, reaching a low of $0.00001238, its lowest level since April 22. It has moved into a technical bear market, falling by almost 30% from its highest point in May. 

Shiba Inu’s decline is mostly because of the ongoing crypto sell-off that has affected all types of coins. Bitcoin (BTC) has dropped from an all-time high of $111,900 last week to $103,000.

SHIB has also crashed as its network faces substantial challenges. First, data shows that SHIB whales have been in a selling spree this year. Supply held by these investors started the year at 743 trillion and has now dropped to 723 trillion. Whale selling is a sign that they expect its price to keep falling.

Second, Shibarium, its layer-2 network, is not doing well as its total value locked stands at just $2.92 million. In contrast, Unichain, which Uniswap (UNI) launched earlier this year, has a TVL of over $600 million. 

Further, Shiba Inu’s token burn rate has lost momentum in the past few weeks. The single biggest burn this week was an 18 million transaction that happened on Wednesday. It was common for SHIB to have over 1 billion burns a few months ago. 

Shiba Inu price analysis

The daily chart shows that the SHIB price peaked at $0.00001755 on May 12 as cryptocurrencies rallied. It then embarked on a strong downtrend, reaching a low of $0.00001235, its lowest point since April 22. 

It has moved below the 50-day moving average and the lower side of the rising wedge pattern. A rising wedge is a bearish pattern comprising of two ascending and converging trendlines.

Therefore, the coin will likely continue falling, with the next target being the year-to-date low of $0.00001033, down by 16% from the current level.