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Ethereum-based meme coin Shiba Inu (SHIB) shed over 25% in value over the last seven days, as of March 20, 2024, as the crypto meme coin mania showed signs of slowing down.
Although losses in the meme coin sector were in line with broader crypto market weakness, Shiba Inu – which hit the list of the best meme coins to watch in 2024 – suffered from massive whale selling and falling trade volume.
In this article, we analyze the factors driving Shiba Inu prices and understand what lies ahead for the SHIB token.
Key Takeaways
- The total crypto market cap fell over 15% in the last 7 days, as of March 20, 2024, according to CoinMarketCap.
- SHIB saw intense whale selling in the third week of March.
- MakerDAO founder Rune Christensen exited SHIB with a handsome $325,900 profit.
- SHIB trade volume fell off the peak in the key South Korean market.
Shiba Inu Price Analysis: Whales Dump SHIB as Meme Coin Frenzy Lose Steam
Whales Sell off SHIB Booking Profits
SHIB saw intense selloffs in the third week of March 2024 as whales booked profits, having seen SHIB prices surge over 150% since the start of the year.
It started with MakerDAO founder Rune Christensen dumping over 25 billion SHIB tokens at an average price of $0.00003298 between March 5 to March 9, data compiled by on-chain analytics platform Spot On Chain showed.
The selloff marked Christensen’s complete exit from SHIB having realized a $325,900 profit from his SHIB trade.
SHIB selling intensified on March 15 as the token dropped 15% in value during the session. On-chain data showed a “smart trader” depositing 1.24 trillion SHIB tokens worth $35.16 million to centralized exchanges (CEX) Binance and Gate.io.
Traders typically use CEX as an off-ramp platform to convert crypto to fiat.
According to Spot on Chain, the “smart trader” sent all their SHIB tokens to CEXs and realized an estimated profit of $23.5 million or 146% if SHIB tokens were sold.
Lower Trading Volume
Shiba Inu trade volumes have been on a steady decline since peaking in late February on decentralized exchanges and in early March on centralized exchanges.
Growth in crypto prices tends to gain early momentum on DEXs as whales and crypto-native traders enter the market before the mainstream media catches news of the price surge.
Data from Ethereum DEX Uniswap v3 showed nearly 200 million SHIB/USDT token pairs trading in the last week of February, leading to a weekly gain of 130%.
However, weekly SHIB/USDT trade volume on Uniswap v3 fell to about 35.2 million tokens by the third week of March 2024 (week ended March 17, 2024) as SHIB prices dropped by over 32% during the period.
Similarly, Binance – the world’s largest CEX by trade volume – saw weekly SHIB/USDT trade volume peak at 355.7 trillion tokens in early March before dropping over 65% to 122.7 trillion tokens in the week ended March 17. 2024.
What’s Next for SHIB? Analyst Predictions
Crypto research firm 10x Research said that they were “cautious” about the near-term Shiba Inu prices as trade volume continued to decline in South Korea, which is one of Shiba Inu’s most popular markets.
👇10-10) As a benchmark for the recent meme-coin hype, Shiba Inu was mainly traded in Korea and was the number 1 traded coin each of the last seven days. Koreans (as measured by volume in UpBit, which was 80% of the Korean market share) traded $10.7 billion worth of Shiba Inu…
— 10x Research (@10x_Research) March 17, 2024
In a conversation with CoinDesk, 10x Research founder Markus Thielen said the meme coin rally that started in February 2024 coincided with political developments in South Korea. Thielen added that the upcoming legislative elections in South Korea scheduled for April 10, 2024, have been a major driver of meme coin trading after the ruling party made a series of pro-crypto promises ahead of the polls, including the approval of spot bitcoin ETFs.
When asked about the performance of meme coins after the election, Thielen said:
“They might lose a little bit of steam. I think we have seen already that volumes have peaked. Volumes have exploded and are now struggling a little bit with support levels. It is very difficult to pump in more and more money.”
Looking forward, regulations will continue to be the biggest risk events for the crypto market in 2024.
The delisting of the world’s most popular stablecoin Tether (USDT) on crypto exchange OKX for European Union (EU) users served as a stark reminder of the power that lawmakers hold.
The European Union is set to implement the Markets in Crypto-Assets Regulation (MiCA) in full on December 30, 2024. Starting July 2024, only stablecoins created by issuers registered as “electronic money institutions” will be allowed in the region.
Elsewhere, Paul Barron, CEO of PB Network, said meme coins could be the first tokens to fall if there is a large correction in the near future. Barron said in a CoinMarketCap podcast:
“There are going to be traders out there that will panic and will most likely panic sell these dips. If we do get a 30% dip, I don’t know necessarily that we’ll see a full 30% coming in, but I think the meme tokens will probably be the first to take damage, you know, as we start to see this market correct.”
The Bottom Line
The broader cryptocurrency market experienced an expected market correction in mid-March 2024 following months of uninterrupted price surges.
Despite the selloffs, Shiba Inu will continue to be a popular meme coin that retail investors will look to profit from in the future.
Meme coin investing is extremely risky. Do your own research and always remember your investment decision depends on your attitude to risk, your expertise in the cryptocurrency market, the spread of your portfolio, and how comfortable you feel about losing money.
The information in this article does not constitute investment advice and is meant for informational purposes only.
