Closing green for the seventh consecutive day and surging over 300% since October 4th, Shiba Inu (SHIB) has surprised crypto investors with a resurgence this week. As a meme coin, SHIB had been trading at the tremendously low price of $.000009 but broke its resistance for the first time in five months. Now this “Dogecoin Killer” has become a trending topic as investors look for the cause of its shocking increase and wonder whether this altcoin could hit a penny.
Typically, SHIB follows Dogecoin’s price fluctuations due to SHIB’s affiliation with the more grounded coin since its start in August 2020. But lately, SHIB has been heading in a different route. In May, SHIB’s circulation was dramatically reduced when Ethereum’s founder – Vitalik Buterin – effectively burned 410 trillion SHIB coins by sending 90% of his SHIB holdings to a dead wallet address. He also donated $1.5 billion worth of Shiba Inu tokens to a COVID-19 relief crypto fund around the same time. These combined transactions caused SHIB’s price to rise 40% in an hour because it reduced the amount of Shiba Inu tokens by 40%. Given the volatility of SHIB coin, the price change after burning close to $7 billion worth of SHIB is unsurprising but the almost 50% reduction set the stage for what would happen next.
Given SHIB’s low value, burning SHIB coin is not detrimental for the coin’s value. With that in mind, SHIB’s developer announced it would be launching 10,000 randomly generated NFTs or “Shiboshis” on the decentralized exchange ShibaSwap. A unique feature of this deal allows each owner to rename their Shiboshi in exchange for burning SHIB. Upon launching ShibaSwap, its developer announced they would burn roughly $25,000 worth of SHIB, and SHIB investors – aka the ShibArmy – were far from opposed to the idea. Since roughly 50% of SHIB has already been taken out of circulation, burning SHIB is seen as a method for strengthening the coin and the community’s support could indicate SHIB’s potential.
But SHIB’s recent success was stimulated early on by its September 15th listing on Coinbase. As is typical for crypto, the listing gave SHIB a boost of 28.87% only one day after listing. But considering Coinbase’s 68 million users, the listing gave some much-needed publicity to the coin and helped lift it from a meme coin to a serious altcoin in some traders’ eyes.
Still, the reason SHIB began trending on Twitter undoubtedly lies with DogeCoin’s favorite, Elon Musk who first tweeted a photo of his Shiba Inu puppy on September 13th before sharing another on October 4th. While neither post mentioned SHIB, the puppy’s breed was enough to send SHIB flying.
Elon Musk has always had a powerful effect on crypto with Dogecoin and Bitcoin offering prime examples. But his most recent tweet has undoubtedly contributed to the 340% increase in SHIB’s value. The runup has been enough to shave a zero off of SHIB’s value overall moving it to the current price of $.000033 and making it the 12th largest cryptocurrency globally.
Interestingly recent reports indicate that an anonymous whale bought almost 6.3 trillion SHIB over the past few days. On October 1st they bought around $43,838,900 worth of SHIB before buying another 116 billion coins afterward. Two more transactions followed, one for 159 billion coins and another for 1 billion coins. With this surprising activity, some are taking SHIB much more seriously. However, it’s important to remember that despite its moment in the limelight, SHIB is at the end of the day a memecoin and its volatility is not to be underestimated.
The coin smashed past its $.000009 resistance for the first time since last May. Now trading at $.0000334, its first support sits at .0000240. Accumulation has picked up with the media publicity and it is currently on an uptrend. Meanwhile, the MACD has witnessed a bullish crossover with no signs of an imminent reversal. Its RSI is currently at 38.
Should You Buy?
With a market cap of $13.3 billion and a daily trading volume currently over $15 billion, SHIB is ranked the 12th largest Cryptocurrency by market cap at the moment. Similarly, SHIB has become the most traded coin on Coinbase.
Rumors of SHIB becoming listed on Robinhood have also driven SHIBs rise and could continue to drive it to new heights. However, the listing has not been confirmed by either party yet. Having over 700,000 holders and a massive social media following, SHIB could be cementing itself as a less volatile altcoin but its sudden rise illustrates the same volatility that currently makes it a risky investment.
SHIB is currently trading at a price of $.0000334 which is only 11% less than it’s all time high of $.00003791. If it maintains its current momentum, SHIB could break past its all-time high, possibly reaching $.00004 in the near future.
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