Why Is The Shiba Inu Price Crashing? The Billion-Dollar Move You Should Know About

Overview

The price of Shiba Inu experienced a significant drop, reaching a low of $0.000007683. This decline was primarily triggered by a major transfer of billions of SHIB tokens, which raised concerns about a potential sell-off by a prominent whale in the market. The situation has garnered attention and sparked bearish sentiment toward this meme coin.

Why The Shiba Inu Price Crashed

The recent crash in Shiba Inu’s price was influenced by considerable selling pressure. A SHIB whale transferred billions of tokens to the crypto exchange Robinhood, suggesting an intention to offload these tokens. Arkham data indicated that the whale, identified by the address 0x2d0…9f7bB, initially sent 210.365 billion SHIB tokens, valued at approximately $1.63 million, to Robinhood. This transaction represented about 97% of the whale’s total SHIB holdings.

Further transactions revealed that the same whale sent an additional 1.52 billion tokens to Robinhood and 7 billion tokens to the liquidity provider B2C2 Group, which could indicate an over-the-counter (OTC) sale. The implications of these transfers were significant, as they coincided with a broader downturn in the crypto market, led by Bitcoin. The price of Bitcoin dropped to as low as $87,000, fueled by concerns over escalating trade tensions between the U.S. and Europe due to tariffs linked to Greenland.

However, the market saw a recovery later in the day when it was announced that the proposed tariffs had been canceled following a deal reached by Trump with NATO. Despite the recent downturn, Shiba Inu remains up over 15% year-to-date and is still recognized as one of the better-performing cryptocurrencies of the year. However, it continues to be far from its all-time high.

Exchange Netflows For SHIB Remains Mixed

The exchange netflows for Shiba Inu have displayed mixed signals, reflecting an unclear accumulation pattern for the coin. According to CryptoQuant data, the net flows on the latest day were negative, with over 7 billion Shiba Inu tokens moving into exchanges. This trend suggests that more tokens are being deposited than withdrawn.

Conversely, the previous day’s netflows were positive, with 1.6 billion tokens exiting exchanges. This trend can be interpreted as bullish for Shiba Inu, as it indicates potential accumulation by whales. Earlier in January, SHIB’s netflows also showed positive signs, totaling around 115 billion tokens; however, these were overshadowed by negative flows of 214 billion tokens recorded shortly afterward.

Despite the recent price crash, crypto traders continue to exhibit bullish sentiment toward Shiba Inu. Data from CoinGlass shows that the long/short ratio is currently above 1, and there has been a notable increase in derivatives trading volume, which has risen by over 20%. Open interest in these derivatives has also increased by nearly 3%. At the time of reporting, Shiba Inu’s price was trading around $0.000007978, reflecting an uptick in the last 24 hours.

From author

The volatility of Shiba Inu highlights the unpredictable nature of meme coins and the significant influence that large holders, or whales, can exert on the market. The mixed netflows indicate uncertainty among investors, while the broader market dynamics, including external factors like trade tensions, further complicate the landscape for Shiba Inu and similar assets.

Impact on the crypto market

• The crash of Shiba Inu’s price underscores the susceptibility of meme coins to large sell-offs by whales, creating volatility and uncertainty.
• The overall market’s reaction to trade tensions and subsequent recoveries can influence investor sentiment and the performance of various cryptocurrencies.
• Mixed exchange netflows suggest a lack of clear accumulation strategies among traders, which could impact future price movements.
• The resilience of Shiba Inu, remaining up year-to-date despite recent declines, may attract attention from investors looking for potential recovery opportunities.
• Increased derivatives trading volume indicates ongoing interest in Shiba Inu, suggesting that traders remain engaged, despite recent price fluctuations.