The recent crypto market crash on August 27th sent shivers down the spines of investors, with Shiba Inu (SHIB) dropping alongside other major coins. However, amidst the turmoil, some intriguing signs suggest a potential price recovery for the meme coin. Here’s a closer look at the forces at play.
Whale Activity Signals Potential for Growth
One glimmer of hope lies in the behavior of large investors, often referred to as “whales.” Data from Santiment reveals a surge in whale activity coinciding with the price dip. These whales, with SHIB holdings exceeding $100,000, have been aggressively accumulating tokens, hinting at a belief in the project’s future. This behavior mirrors their actions on July 18th, which preceded a notable price rise.
Further evidence comes from IntoTheBlock, indicating positive netflows for large holders during the crash. This suggests significant buying activity from whales, potentially positioning themselves for a price upswing.
Decentralized Future: A Boost for SHIB?
Adding fuel to the potential recovery fire is the announcement of a Shiba Inu decentralized autonomous organization (DAO). This community-driven initiative, spearheaded by SHIB Head of Marketing Lucie, would empower holders to influence the project’s direction through voting. Increased community engagement could translate to renewed interest and potentially drive up the price.
Popularity Waning, But is it a Dealbreaker?
Despite the positive signals, there are concerns. Social dominance, a metric signifying public interest, has plummeted for SHIB, reaching a one-year low of 0.268%. Additionally, negative sentiment seems to be prevailing in the market, potentially hindering investor confidence.
Burn Rate Woes: A Cause for Alarm?
Another worrying sign is the significant drop in the Shiba Inu burn rate, a process designed to reduce token supply and theoretically increase value. The Shibburn platform shows a drastic decrease from over 7 million tokens burned daily to a mere 261,691, a concerning dip.
This decline could indicate waning community involvement or a shift in strategy. Perhaps holders are holding onto their tokens in anticipation of a price rise, opting not to burn them.
The Verdict: A Cautious Optimism
While the current situation poses challenges, Shiba Inu remains a project with strong foundations. The market-wide correction is not specific to SHIB, and similar to the August 5th crash, the recovery could be even stronger. Forecasts suggest a potential 35% jump to $0.00001740 in a bullish scenario.
The key takeaway? Whale activity and the upcoming DAO are encouraging signs. However, declining popularity and burn rate require close monitoring. Whether SHIB rises from the ashes or succumbs to negativity largely depends on the community’s renewed engagement and the project’s ability to regain investor confidence.
