Shiba Inu [SHIB], the second largest memecoin based on market capitalization, has witnessed a prolonged downward trend in recent weeks. Presently, SHIB is being exchanged at $0.00001325, reflecting a 1.62% decrease within the last 24 hours.
During this time frame, there has also been a notable reduction in SHIB’s trading volume, with a 20% decrease bringing it down to $136.4 million over the last day.
Prior to this decline, SHIB managed modest gains over the previous 7-day period with a 0.77% increase. Nonetheless, on a monthly scale, the memecoin has faced a 2.50% decline, signaling an overall downward trend for SHIB.
These market conditions have triggered uncertainties regarding the future performance of the memecoin. According to Santiment’s analysis, SHIB is currently reporting its poorest 30-day average trading returns.
The Current Sentiment Analysis
Santiment has identified SHIB as the weakest performing memecoin in 2024. The data indicates a 30-day average trading return decrease of -1.1% and a long-term return plummet of -31.7%.
Moreover, social conversations surrounding SHIB have dwindled significantly over the past year, reaching remarkable lows since July. This decline hints at existing frustration and apathy among traders, particularly as retail traders are closing their positions at a notable rate.
Additionally, retail traders of Shiba Inu have been reducing their positions, with wallets holding less than 1 billion SHIB hitting the lowest levels seen since 2022. This behavior reflects escalating Fear, Uncertainty, and Doubt (FUD) within the market, especially when only 1 billion wallets are holding the majority of SHIB.
While SHIB has underperformed over the past year, these circumstances suggest a potential turnaround for the meme-coin once the cryptocurrency markets stabilize.
Insights from SHIB Charts
As highlighted by Santiment, the charts of SHIB illustrate a continuous decline in retail traders and their profitability.
This trend is further supported by a reduction in transaction counts, dropping from 11,830 to 6,430. The dwindling activity signals lower demand and a diminishing interest in the memecoin.
Furthermore, the ownership concentration breakdown of SHIB reveals that retail traders own 26.65%, investors hold 13.4%, and whales possess 59.95%. This distribution, where retail traders hold a smaller share, indicates a lack of trust among everyday small traders.
This scenario indicates that retail traders are divesting their holdings due to prevailing FUD and uncertainty about the future, creating an overall bearish market sentiment as smaller investors exit in anticipation of further declines.
Consequently, SHIB is facing a strong negative sentiment within the market, resulting in the departure of retail traders. If these conditions persist, it is likely that the memecoin will descend to a critical support level priced around $0.00001263.