SHIB has dropped 44% from its year-to-date high of $0.0001009, with on-chain data signaling further downside ahead.
Active addresses have fallen since February 13, while short-term holders have cut their supply since February 7 — both pointing to weakening demand.
A declining Smart-Money Index suggests institutional investors are not absorbing sell pressure, raising the risk of a further decline.
Shiba Inu (SHIB) has lost nearly half its value since hitting a year-to-date high of $0.0001009 on January 5. On-chain indicators continue to flash warning signs that the decline may not be over.
The popular meme token has dropped 44% from its January peak, pressured by the weakening sentiment that has pushed traders away from many high-risk assets in recent weeks.
Meme coins have borne the brunt of capital rotation, with demand and trading activity declining steadily across many assets in that sector.
Now, with SHIB eyeing another leg down, what does this mean for meme coin holders?
According to Glassnode, the daily active address count on the Shiba Inu network has fallen steadily since February 13, suggesting a decline in user activity on the blockchain.
The number of active addresses peaked at 3,637 on that day before sliding sharply, bottoming at 1,984 by March 1, a 45% drop in under three weeks.
While a modest recovery has been observed since, the count remains well below its February highs, closing at 2,321 addresses as of March 9.
When fewer addresses are actively transacting on an asset’s network, it signals reduced organic demand. For SHIB, that decline in participation has directly translated into sustained price weakness over the past month.
Compounding this bearish setup is the behavior of SHIB’s short-term holders (STHs). Per Glassnode, SHIB investors who have held their coins for one to three months have reduced their supply by 82% since February 7.
For context, on February 7, this group controlled 16.04% of SHIB’s circulating supply. However, as of March 9, this closed at a low of 2.86%.
This trend is noteworthy because these investors are newer market entrants and “weak hands,” more likely to exit positions in response to market volatility.
When they start cutting their supply like this, it weighs on buy-side pressure and generally weakens bullish sentiment. This increases the risk of a further dip in SHIB’s price.
Smart Money Pulls Back as Sell Pressure Mounts
Readings from the SHIB/USD one-day chart show that SHIB’s Smart-Money Index (SMI) has trended downward since the price decline began in January.
An asset’s SMI measures institutional investor activity by tracking price movements at specific times during the trading day. It reflects how “smart money” trades during the end-of-day sessions, after retail-driven volatility in the morning.
When it climbs, it indicates increased confidence among institutional investors, which may drive up demand for the asset.
Conversely, a falling SMI, as in SHIB’s case, signals that key investors are not stepping in to absorb sell pressure. Without strong conviction from this side of the spot market, SHIB may maintain its downtrend in the meantime.
In this scenario, the meme coin could fall toward $0.00000507, marking a near 10% dip from its current market price of 0.00000560.
However, an uptick in new demand for SHIB could invalidate this bearish outlook. Should this happen, it could push the coin’s price past the $0.0000625 barrier.
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Disclaimer:
The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
Abiodun Oladokun is a Research Analyst at CCN, where he covers cryptocurrency markets with a focus on on-chain analysis, technical assessments, and emerging trends across decentralized finance (DeFi), real-world assets (RWA), artificial intelligence (AI), decentralized physical infrastructure networks (DePIN), Layer 2s, and meme coins.
Prior to CCN, he served as a Senior On-Chain Analyst at BeInCrypto, producing market reports spanning diverse crypto sectors.
Before that, he conducted technical analysis and market assessments of various altcoins at AMBCrypto, where he also contributed long-form quarterly research papers on DeFi, NFTs, DAOs, and scaling architectures, leveraging on-chain platforms including Messari, Santiment, DefiLlama, and Dune Analytics.
He began his crypto career as a research analyst at SixthSense DAO, developing blockchain forensic tools to trace the history of stolen assets.
Abiodun is a lawyer called to the Nigerian Bar and the founder of Ilé Ijó, a Lagos-based electronic dance music collective.
