Shiba Inu (SHIB) is poised for a potential parabolic rally this October, following historical trends that suggest monthly positive returns. According to CryptoRank, the meme coin has consistently performed well in October, notably surging by 833% during the 2021 bull run. More recently, it saw gains of 10% and 6% in October 2022 and 2023, respectively. With a bullish outlook for the broader crypto market—especially Bitcoin, which typically experiences its highest returns between October and December—there’s optimism surrounding SHIB’s potential performance.
The correlation between Shiba Inu and Bitcoin is notably strong, with data from IntoTheBlock indicating a correlation coefficient of 0.89. This suggests that as Bitcoin rallies, Shiba Inu is likely to follow suit. Investor sentiment appears to reflect this anticipation, as on-chain analytics from Cryptoquant reveals that approximately 770 billion SHIB were accumulated between September 23 and 24. Such accumulation indicates that many investors are positioning themselves for a longer-term hold rather than immediate trading.
However, despite this optimistic sentiment, Shiba Inu’s fundamentals raise some concerns. The burn rate has drastically dropped by over 90% in just 24 hours, and there has been a 61% decline in the number of tokens burned over the past week, according to the Shibburn tracker. Compounding this issue is the stagnant activity on Shibarium, SHIB’s layer-2 network, which has seen daily transactions hover below 10,000. The recent peak of 11,360 transactions on September 19 quickly dwindled to just 8,000 the following day, indicating waning interest in the network.
The lack of significant activity on Shibarium is critical, as base transaction fees on this network are converted to SHIB and subsequently burned. With low engagement, the number of SHIB tokens being burned remains limited, potentially undermining the coin’s long-term value proposition. As investors navigate this landscape, the ultimate question remains: can historical patterns and investor sentiment outweigh the current bearish fundamentals as October unfolds? Only time will tell.
September 2024, Cryptoniteuae
