Whales find a liking for Shiba Inu [SHIB] but a burning issue prevails

On Jan 10, 2023

Shiba Inu became one of the most-purchased tokens in the last 24 hours, as whales bought the token in droves.
However, its network activity and daily addresses recorded a fall.

According to data shared by WhaleStats, Shiba Inu [SHIB] was favored by big addresses as it became one of the most purchased tokens among 100 biggest Ethereum [ETH] whales in the last 24 hours. 341, 296, 045 SHIB coins worth $3,002 were snapped up by whales during the above period.

JUST IN: $SHIB @Shibtoken is back on top 10 purchased tokens among 100 biggest #ETH whales in the last 24hrs 🐳
Check the top 100 whales here: https://t.co/N5qqsCAH8j
(and hodl $BBW to see data for the top 5000!)#SHIB #whalestats #babywhale #BBW pic.twitter.com/9B7ldk5i4n
— WhaleStats (tracking crypto whales) (@WhaleStats) January 10, 2023

However, whales’ interest was not backed up by the price action of the meme coin. At the time of writing, SHIB fell by 1.41% from the previous day, data from CoinMarketCap showed.

The drop marked an end to the brief rally observed since the beginning of 2023, during which the coin locked in gains of about 11%. The market cap also contracted by 1.31% until press time.

The burn is real

Shibburn, which tracks the burn activity of Shiba Inu, showed that the burn rate dipped significantly. 13 million tokens were burned in the last 24 hours as compared to about 37 million registered on the previous day. In fact, the surge in burn activity was construed as one reason behind the price rise seen earlier.

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Source: Shibburn

The burn rate accelerated, riding high on the buzz surrounding the soon-to-be-launched layer-2 blockchain solution Shibarium. On 7 January, Shiba Inu developers announced on Twitter that every transaction on the Shibarium network would result in a burn of SHIB tokens.

Shibarium Update 🧵
While on our last post we wanted to remind everyone that BONE 🍖 serves as the required gas token for operability within Shibarium, we also would now like to formally announce that each #Shibarium transaction will burn 🔥 SHIB.
1/2 🧵 pic.twitter.com/zQRoOuL9oW
— Shibarium Network (@ShibariumNet) January 7, 2023

Coin burning has caught the eye of crypto enthusiasts as most platforms are looking to remove coins out of circulation to increase their value. Thus, it became evident why SHIB’s holders found the narrative appealing.

However, the rise in burn rate was also accompanied by some unusual activity. It was observed that a single wallet burned 14 million SHIB, which was quite uncommon.

Shiba Inu network activity dips

This growth in new addresses failed to evoke any optimism as it contracted by 80% ever since reaching a high on 7 January, as per data provided by Santiment. The daily active addresses matched this trajectory and recorded a drastic fall. The sudden drop in network activity also contributed to the price fall.

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Source: Santiment

Additionally, the social activity declined, which was reflected in the drop in the social dominance indicator of the meme coin. However, it started to rebound at press time, which was a good sign.

On the whole, SHIB observed a positive trend due to interest shown by whales and the announcement of new blockchain and metaverse projects. With more collaborations in the pipeline, its perceived utility will be expected to increase and holders would be tempted to ignore short-term downsides.

This article originally appeared here.