Can SHIB start a new uptrend as the supply diminishes?
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Key Takeaways
Shiba Inu burned 9.9 Billion SHIB in January 2024.
December’s burn was fueled by Shibarium-powered burns.
The automation of SHIB burns on Shibarium is underway.
Shiba Inu (SHIB) has made headlines with a token burn in January 2024. The event saw a substantial number of SHIB tokens permanently removed from circulation in an attempt to influence the cryptocurrency’s value and scarcity.
Let’s delve into the details of the January token burn, compare it with previous months, and explore the potential impact on SHIB‘s price.
9.9 Billion Token Out Of Circulation
In January 2024, the Shiba Inu cryptocurrency ecosystem witnessed the burning of approximately 9.9 billion SHIB tokens, a move aimed at reducing the token’s circulating supply and potentially increasing its value.
This burn removed about $88,348 worth of SHIB from circulation. However, this was significantly less than the record 36 billion SHIB tokens burned in December 2023. The December burns were primarily fueled by transactions on the Shibarium layer 2 scaling solution.
Despite the ongoing burns, which have destroyed more than 410.7 trillion SHIB tokens, the community is pushing for more aggressive burning mechanisms. The focus is on increasing Shibarium gas fees to enhance the burn rate.
Furthermore, there is a plan to automate SHIB burns on Shibarium. They will be tested on Puppynet before a mainnet launch. This indicates a more strategic approach to make token burning more systematic.
SHIB Price Analysis
Shiba Inu trended upwards from its lowest point since the all-time high of $0.0000061 on June 9, 2023. At first, it came to its descending resistance anchored at the August 2022 high, causing a reversal.
But it kept a higher low of $0.0000068 on October 19, leading to a breakout. However, the momentum stopped at the prior high of $0.000011, indicating strong horizontal resistance.
SHIB is testing for support.
SHIB fell back to its previous falling resistance, testing it for support around $0.0000085. If it does find support, it can bounce, starting another uptrend.
In this case, we could see Shiba Inu’s price breakout above its horizontal resistance. This, in turn, would signal the next bull phase. Although the first higher low already hinted at this, we didn’t see a significantly higher high.
The next uptrend could show that SHIB is embarking on another multi-year bull cycle where it could make a new all-time high.
Disclaimer
Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.
Nikola Lazic is a cryptocurrency analyst and investor working in the industry since 2017. He holds a bachelor's degree in Sociology, which enables him to better understand the psychology behind the crowd´s positioning. Consequently his preferred analytical tool is Elliott Wave Theory in combination with price action analysis.
Combining his experience in trading and investing with knowledge in content writing he strives to bring the most accurate and actionable information.
