After seeing a flurry of on-chain activity, the Shiba Inu (SHIB) coin is presently experiencing a mysterious decline. According to data, the burn rate, which lowers supply by sending tokens to an unaccessible wallet, has plateaued at 0%.
Technically speaking, SHIB looks to be creating an ascending triangle pattern on the daily chart, with a rising lower trendline working as support and a flat upper trendline acting as resistance.
Traditionally, this pattern is interpreted as a positive indication, and an upside breakout usually marks its resolution. The triangle’s top trendline for SHIB is located close to the $0.0000096 level. A strong closing over this resistance would indicate the conclusion of the consolidation phase and the beginning of a new rising trend, which may trigger a price spike.
But there’s a conundrum because of the contradiction between the on-chain data and the chart pattern. Although the technical indicators point to a possible upward rise, the dearth of on-chain activity begs the issue of what might propel such a move. Particularly puzzling is the burn rate’s stagnation, as token burning can indicate a healthy ecosystem and are frequently employed to exert deflationary pressure.
A possible explanation for the decline in on-chain activity might be a change in investor mood brought on by a more general market decline or new stories in the cryptocurrency world that have diverted focus from meme tokens such as SHIB. Furthermore, there can be a pause in the community-driven component of SHIB’s burn mechanisms, which might indicate a decline in community involvement.
It’s also important to take into account outside variables that can have an influence on transaction volumes, such regulatory scrutiny or platform-specific problems. Currently, our only recourse is to speculate in the absence of a clear reason for the fall in on-chain activity.
