Shiba Inu's Bearish Future: On-Chain Data Paints a Bleak Picture

Shiba Inu (SHIB) faces potential price declines due to bearish on-chain metrics. Network growth, "In The Money" metric, and whale activity have decreased, indicating reduced investor confidence. However, the "Bid-Ask Volume Imbalance" suggests some buying interest, providing a potential signal of recovery following SHIB's recent price correction.

Shiba Inu Price at Risk of Further Decline, On-Chain Metrics Show Bearish Sentiment

Shiba Inu (SHIB), the popular meme coin, faces potential price setbacks as various on-chain metrics indicate a pessimistic outlook within its ecosystem. Despite recent signs of recovery following a substantial price correction, SHIB's growth and sentiment appear to be waning.

Decline in Network Growth and Holder Profitability

According to data from IntoTheBlock, a leading market intelligence platform, Shiba Inu's net network growth has plummeted by 0.48% in the past week. This metric measures the total number of addresses holding SHIB, suggesting a decrease in active holders.

Furthermore, the "In The Money" metric, which tracks the proportion of SHIB holders who are currently in profit, has also declined by 0.20%. This decline indicates that the majority of SHIB holders are experiencing losses on their investments, dampening overall sentiment.

Reduced Whale Activity and Token Concentration

The number of large transactions on the Shiba Inu network has also decreased, highlighting the bearish sentiment. Whale activity, defined as transactions exceeding $100,000, has dropped by over 10% in the past week, indicating that large investors are refraining from accumulating the asset.

This decline is particularly concerning given that Shiba Inu whales reportedly hold a significant 73% of the token's circulating supply, playing a crucial role in price discovery. The reduced whale activity is also reflected in the "Concentration" metric, which indicates neither a bullish nor bearish trend at present.

Silver Lining: Bid-Ask Volume and Long-Term Outlook

Despite the bearish indicators, the "Bid-Ask Volume Imbalance" metric remains bullish, suggesting that investors are accumulating SHIB. Buy orders have the potential to trigger an upward price movement. Additionally, on-chain signals could swiftly turn positive with an increase in SHIB's value.

Notably, the broader outlook for SHIB remains optimistic. Several crypto analysts anticipate the meme coin to experience substantial gains during the current market cycle. Some analysts, such as Altcoin Sherpa, have even predicted that SHIB may eventually surpass Dogecoin (DOGE) as the dominant meme coin.

At the time of writing, SHIB trades at approximately $0.00002667, exhibiting a slight increase over the past 24 hours. The token's price trajectory remains closely monitored by investors and analysts alike, as the on-chain metrics and market conditions continue to evolve.