- Shiba Inu’s burn rate surged by 972%, with over 5.4 million SHIB removed from circulation in 24 hours.
- The token’s price increased 3% within a day, yet resistance levels remain a hurdle for further gains.
What happened: Burn rate spike boosts SHIB
The dog-themed cryptocurrency Shiba Inu (SHIB) has drawn significant attention as its burn rate surged an astonishing 972%, permanently removing 5,441,220 SHIB tokens from circulation within a single day, as reported by Shibburn. This spike in the token burn rate is part of an ongoing effort to reduce the total supply, a mechanism designed to enhance scarcity and potentially drive long-term value.
This dramatic development coincided with a 3% rise in SHIB’s price over the last 24 hours, with the token now trading at $0.000022. Weekly performance has also shown positive momentum, with a 4% increase reflecting growing confidence among investors and holders.
However, despite this promising trend, SHIB remains within a narrow trading range, moving between $0.0000187 and $0.0000259, its respective 200-day and 50-day simple moving averages (SMA). Analysts emphasise that breaking through the critical resistance level of $0.0000223 is essential for sustained recovery, potentially paving the way for a further rally to $0.00003 or even $0.000033 if SHIB overcomes stronger resistance thresholds.
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Why it’s important
Shiba Inu’s burn mechanism is a vital component of its tokenomics, aimed at reducing the circulating supply and potentially driving value by creating scarcity. The recent 972% surge in its burn rate highlights a resurgence of community engagement, demonstrating the tangible impact such mechanisms can have on market sentiment.
However, the token’s 18.59% decline in December underscores the inherent volatility of cryptocurrencies, posing challenges for cautious investors.
This moment could prove pivotal as Shiba Inu attempts to break through key resistance levels near its daily SMAs, potentially setting the stage for a significant price rally. With cryptocurrency markets increasingly adopting deflationary models, SHIB’s performance may shape broader strategies for similar assets, offering insights into how burn mechanisms can influence long-term valuation and market dynamics.
