Home / Analysis / Crypto / Technical Analysis / Shiba Inu Whales Buying up Ahead of Shibarium, Is $0.01 on the Cards for $SHIB?

Shiba Inu Whales Buying up Ahead of Shibarium, Is $0.01 on the Cards for $SHIB?

Last Updated August 11, 2023 11:27 AM
Nikola Lazic
Last Updated August 11, 2023 11:27 AM

Key Takeaways

  • SHIB token recovered by 75% from its June downfall
  • On-chain data suggest buying pressure, but not from whales
  • $0.01 target improbable, but not impossible

Shiba Inu is the offspring of the popular meme coin Dogecoin. In the last bull cycle, when the market reached its peak exuberance after the Dogecoin price rally was over, those who missed out were looking for another opportunity. 

Shiba Inu capitalized on this FOMO. The Dogecoin rally started in December 2020, and ended in May 2021, with an increase of 236x. Shiba Inu rallied September – October 2021 by 11.88x, coming to $0.000087 at its all-time high. 

In the bear market, SHIB decreased by 93%, reaching $0.0000061 at its lowest point in June 2023. Still, it managed to maintain its high position among the top market capitalization cryptos and is currently in the 14th place. 

Due to its rise and high market share, it’s developers have strived to come up with a function other than a meme. Now, a highly anticipated upgrade, “Shibarium”, is on the horizon which brings scalability to the Shiba Inu network and expands its functionality with Self-Sovereign Identity (SSI). 

What is Shibarium?

Shibarium is a layer 2 (L2) solution that empowers the Shiba Inu blockchain, bringing more transaction capabilities and faster execution speed. First introduced in a blog post  on January 15, the post explains how Shiba Inu has always been about on-ramping crypto newcomers and that dApps are the cornerstone of Web 3. Shiba Inu states that “some of the biggest obstacles to mainstream adoption are the cost and speed of transactions.”

With Shibarioum being a L2 on Ethereum it will further enable users to be more functional in Web 3 and push the market towards more decentralization. As part of its Shiba Inu ecosystem, the gas fees will be paid by burning SHIB tokens which will reduce its high supply over time. Its primary function would be to address scalability issues, but also host dApps. It has its own native tokens THREATH, LEASH and BONE

Shibarium will help grow the Shiba Inu ecosystem and tie it all together. ShibSwap DEX will “merge and evolve with Shibarium,” while numerous useful applications like the mentioned SSI and Shibacals – a system for authenticating physical collectibles using NFC chips, can now be built. Redesigned in this way, the Shiba Inu ecosystem can position itself as potentially a leading one in further propelling user adoption and bringing more use cases for the real world. 

On-Chain

There is some evidence that investors are buying the token amid these new developments. By looking at the All Exchange Reserves chart from Cryptoquant  we can clearly see a downtrend. 

Diminishing supply on exchanges mean accumulation

Investors have been stacking up on SHIB in this bear market. Recently we have seen a more aggressive downward spike. On July 18, the number of SHIB on exchanges was 172 trillion SHIB. It fell sharply to 170 trillion on the next day and continued decreasing to 169 trillion at its lowest point on August 5. Consequently, the price rose in that period. 

However, this accumulation is mostly done by retail investors and not the whales, as data from Intotheblock  suggests.

Retail investors buying up the hoken

The overall concentration has shifted by 11.39% in favor of retail and 0.87% towards investors, while on the other hand, whales lost 3.37% token concentration in the last 30 days. 

Looking deeper into the supply distribution, we can see that the highest decrease of 21.43% is among 10T-100T SHIB token holders. The highest increase is among 100B-1T SHIB holders, while among below 100B threshold cohorts, the next highest increase was seen in 1M-10M SHIB of 3.07%. 

whales are losing in supply distribution

Can SHIB Reach $0.01? 

So how does this impact the SHIB token, and can we see its price at $0.01 in the future? 

The price of the SHIB token was been on a decline since October 28, 2021, when it reached an all-time high of $0.000087. From there, as it entered a bear cycle, we saw a decrease of 94%, measured to its lowest point of $0.0000060 on June 10, 2023. 

Is $0.01 target possible?

At first, it was in a steep and sharp declining phase but reached a horizontal zone between $0.0000060 on its lower level and $0.000014 on its upper level. This range can be interpreted as an accumulation zone, but we are still to see some positive signs. 

The first positive sign would be a higher low, and the next one would be a higher high leading the price to breakout above the zone’s resistance. Measuring the $0.01 target from the current levels, the price would need to increase by 1086x. 

This isn’t improbable but the amount of increase needed for the price to reach this target means the same increase in its market cap, which is currently $5,380,240,955. As it won’t move in a straight line and would need time and a bull market environment, the other coins would also increase in market cap. But even so, if it reaches $0.01, its market cap would be $5,843,264,491,587. In comparison, Bitcoin’s current market cap is $564,786,353,997, while Ethereum’s is $220,091,608,540. 

 Let’s say that in the next bull cycle, the price of Ethereum reaches 18,310 (a ten-fold increase from the current price), its market cap would be $2,200,916,085,400, meaning that for Shiba Inu to reach $0.01 in the next bull market peak, it would overtake Ethereum in its 2. place. 

Conclusion 

The price of Shiba Inu has been on the rise since June 10, when it fell to $0.0000060 and made a 75% recovery measured to its highest point on August 5, of $0.00001. The drivers of this rise were mostly retail investors and lower holding cohorts, while the whales steadily decrease in token concentration. 

But with new developments in the expected Shibarium release in August, that might change, and we can finally see whales waking up and buying up the SHIB token, leading it to a breakout from its accumulation zone above $0.000014. 

The $0.01 is still far-fetched, and although not impossible, it is still very early to predict these kinds of price increases, especially considering its implications – SHIB potentially overtaking Ethereum. 

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.

Was this Article helpful? Yes No