Shiba Inu Braces for Volatility as Exchange Transfers Surge

The meme coin Shiba Inu (SHIB) could be heading toward increased market turbulence as token holders begin moving their assets from personal wallets to exchanges, hinting at possible selling pressure.

Recent trends indicate a noticeable rise in the number of SHIB tokens being transferred to exchanges, as reported by CryptoQuant. This shift away from self-custody often signals that investors are preparing to sell, which can lead to heightened volatility.

However, despite this potential warning sign, there are several positive developments surrounding Shiba Inu. One notable factor is the rapid expansion of Shibarium, SHIB’s layer-2 scaling solution.

Daily transaction volume on Shibarium saw an impressive surge, leaping from just over 28,000 transactions on October 18th to more than 324,000 on October 19th. By October 21st, activity had balanced out at around 128,000 transactions, and the platform now boasts over 1.8 million active wallet addresses.

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Another encouraging indicator is SHIB’s token burn rate, which has been instrumental in reducing the supply. Although the burn rate dipped by 99.68% recently, with only 21,205 tokens burned in the last 24 hours, the overall supply has been significantly reduced, with approximately 50% of the total supply already burned.

Looking ahead, as the burn rate continues to cut down the token supply and new projects on SHIB’s roadmap emerge, demand for SHIB could rise. This combination of factors has the potential to drive prices upward, balancing out any short-term selling pressures.

Kosta Gushterov

Kosta has been working in the crypto industry for over 4 years. He strives to present different perspectives on a given topic and enjoys the sector for its transparency and dynamism. In his work, he focuses on balanced coverage of events and developments in the crypto space, providing information to his readers from a neutral perspective.