Shiba Inu (SHIB) is on the verge of a historic run as investors have accumulated a significant amount of Shiba Inu tokens in recent days. However, the meme coin fundamentals remain concerning as they paint a bearish picture for SHIB.
Shiba Inu gears up for historic run in October
Shiba Inu is set to enjoy a parabolic rally in October if history repeats itself. Data from CryptoRank shows that the meme coin has consistently had positive monthly returns in October. During the 2021 Bull Runthe price of SHIB soared 833% in October of that year, while it saw modest gains of 10% and 6% in October 2022 and 2023, respectively.
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Therefore, Shiba Inu could see significant gains this October. Furthermore, the outlook for the broader cryptocurrency market in October is also bullish. For example, Bitcoin has historically enjoyed its highest returns between October and December. The leading cryptocurrency is expected to enjoy a price rally again starting October.
As such, the price of Shiba Inu will also rise as Bitcoin enjoys an upward trend. Data of IntoTheBlock market intelligence platform shows that SHIB’s price correlation with BTC is currently at 0.89, which indicates a strong positive price correlation between both assets. This proves that the meme coin will rise as Bitcoin moves higher.
Shiba Inu Investors are already preparing for the historic race, as the data from Cryptoquant on-chain analytics platform shows that they accumulated 770 billion SHIB between September 23 and 24. This number represents the outflows that left the exchanges in these two days. The withdrawal of coins from the exchanges indicates that these investors intend to hold them for the long term.
This accumulation trend among these investors could also contribute to the price increase that Shiba Inu could enjoy in October.
Fundamentals remain a concern
Shiba Inu’s fundamentals are a concern as they paint a bearish picture for the meme coin. Data from the Shiba Inu burn tracker, Shibburn, shows that the coin burn rate has fallen by over 90% in the last 24 hours. Meanwhile, there has also been a 61% drop in the number of tokens burned in the last seven days.
The lack of network activity in Shibari is another bearish fundamental. Data from the Shibarium explorer shows that daily transactions on the layer 2 network remain stagnant and below 10,000. A recent high was 11,360 transactions recorded on September 19. However, the following day, daily transactions dropped to 8,000.
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The low activity in Shibari also contributed to the decline in the Shiba Inu burn rate. Basic transaction fees on Shibarium are usually converted to SHIB and burned. However, with such low interest on the layer 2 network, there is a limit to how many SHIB tokens can be burned.
At the time of writing, Shiba Inu was trading at around $0.000014, up over 3% in the past 24 hours, according to data from CoinMarketCap.
Featured image created with Dall.E, chart from Tradingview.com