Here’s Why Shiba Inu (SHIB) Price Is Down

Shiba Inu (SHIB), the Dogecoin-inspired meme coin, has faced a recent price correction, leaving investors wondering about the underlying causes. While cryptocurrency markets are known for volatility, several specific factors have contributed to SHIB’s downward price movement.

Bitcoin’s Influence on the Crypto Market

The recent decline of Shiba Inu closely mirrors the trajectory of larger cryptocurrencies like Bitcoin (BTC) and Dogecoin (DOGE). This downturn is largely influenced by Bitcoin, which has been negatively impacted by rising outflows from Spot Bitcoin ETFs. Altcoins, including SHIB, tend to be particularly sensitive to these broader market trends.

Highlighting the magnitude of the outflows, for the first time since the introduction of spot Bitcoin ETFs in the United States, Cathie Wood’s ARK 21 Shares Bitcoin ETF experienced daily outflows exceeding $87 million. This surpasses even those of Grayscale’s Bitcoin Trust (GBTC), further emphasizing the increasing amount of outflows witnessed by ETFs.

Declining Trading Volume and Investor Sentiment

Shiba Inu’s trading volume has decreased significantly in recent times. According to data from CoinMarketCap, SHIB’s price has fallen by over 11% within 7 days, and its trading volume has also decreased by a significant 21% in the last 24 hours. A decline in trading volume usually indicates lessening investor interest and can lead to a decrease in the coin’s price.

This could be due to several reasons, including investors shifting their attention to other assets or taking a cautious approach during market downturns. When investors feel uncertain or experience fear of further losses, they may opt to sell their SHIB holdings, leading to intensified selling pressure.

Profit-Taking After Recent Gains

SHIB experienced a notable price surge in previous weeks, prompting some investors to take profits. Profit-taking is a common practice where investors sell an asset after it has appreciated, aiming to lock in their gains. This selling activity can temporarily push prices downward, especially in a less liquid market.

Regulatory Uncertainty

The cryptocurrency market remains subject to evolving regulations across different jurisdictions. News or announcements regarding increased regulatory scrutiny can create uncertainty and risk-averse sentiment among investors. This uncertainty can cause investors to become more cautious, potentially leading to a decrease in their willingness to buy or hold riskier assets like meme coins.

The Inherent Volatility of Meme Coins

Meme coins, such as Shiba Inu, are known for their significant price volatility and are often influenced by social media trends and hype. While rapid price increases can occur due to sudden popularity, these gains may not always be sustainable. Market corrections are a natural part of the cycle, especially for assets that experience dramatic price swings.

Long-term Outlook

Despite the current price dip, it’s important to remember that cryptocurrency markets are cyclical. While short-term fluctuations are common, it’s essential to consider the long-term potential of a project. Developments within the Shiba Inu ecosystem, such as an increase in token burns, strategic partnerships, etc, could positively impact SHIB’s price in the future.

---

Follow us on Twitter, Facebook, Telegram, and Google News