Further decline or a revival: what’s next for the self-proclaimed Dogecoin killer?
The situation for the second-largest meme coin has worsened recently, following a double-digit slide over the past 14 days.
Some worrying factors suggest Shiba Inu (SHIB) could experience a further collapse in the near future, while one popular analyst predicted it might crash to a five-year low.
The Free Fall is Yet to Happen?
While Shiba Inu enjoyed some notable surges last year, 2026 has been nothing but painful. As of this writing, it trades at around $0.000005467 (per CoinGecko’s data), representing a whopping 60% plunge on a yearly scale.
Its market cap has tumbled to roughly $3.2 billion, further widening the gap with niche frontrunner Dogecoin (DOGE), which maintains a capitalization of more than $15 billion.
According to Ali Martinez, SHIB might be on the verge of a crash to as low as $0.00000138. This is not the first time the analyst has warned about such a scenario. Last month, he noted that the meme coin dropped below the important level of $0.00000667, claiming this could have opened the door to a meltdown to the aforementioned zone.
Shiba Inu’s burning mechanism also signals that a further pullback may be on the way. Over the past 24 hours, the burn rate has decreased by approximately 99% after only 20,176 SHIB were sent to a null address.
The program’s ultimate goal is to reduce the meme coin’s overall supply, potentially making it more valuable in time (assuming demand remains constant or heads north). It was adopted in 2022, and since then, the team and community have destroyed more than 410.7 trillion tokens, leaving 585.47 trillion in circulation.
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The stalled progress of Shibarium is also a bearish factor. Shiba Inu’s layer-2 scaling solution saw the light of day in the summer of 2023 and aims to foster the project’s development by lowering transaction fees, improving speed, and enhancing scalability. It suffered an exploit in September last year, which shook investor trust and caused widespread damage across the Shiba Inu ecosystem. Prior to the incident, daily transactions processed on Shibarium were in the millions, while after that, they plummeted to mere thousands.
The Bullish Signals
Even as the meme coin struggles and the broader crypto market is under pressure, SHIB’s supply on centralized exchanges keeps shrinking. According to CryptoQuant’s data, those reserves fell below 81 trillion tokens, the lowest point since May 2021.
The development could be interpreted as a positive sign because it suggests that investors are in no rush to move their holdings to such platforms: a move often seen as a pre-sale step.
Meanwhile, Shiba Inu’s Relative Strength Index (RSI) briefly plunged below 30, indicating the asset has entered oversold territory and could be due for a resurgence. The technical analysis tool runs from 0 to 100, and conversely, ratios above 70 suggest SHIB could be overbought and gearing up for a possible correction. As of this writing, the RSI stands at roughly 36, or much closer to the bullish zone.
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