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SHIB Price has been on a fall in the recent few days. This comes after a historical price rally that saw the coin recording an all-time high of $0.00008. Currently, it is trading at the $0.00005 range.
Most analysts believe the recent fall is temporary hence, we could see a future rally as it is the norm with the cryptocurrency market.
Historically, the prices of cryptos are driven more by market sentiment rather than the traditional triggers. That is why a coin such as a SHIB without much utility yet could rise to 500% within a single week.
To understand why the coin has a chance of rallying again, we need to evaluate some of the factors that could contribute to this.
High Inflation levels
The world is currently experiencing inflation levels never seen before in decades. This is causing investors to look at alternative assets for hedging reasons.
One of the beneficiary markets in this shift is the crypto market. The decentralization and secure nature of this market are making investors shift from traditional choices such as commodities and fiat currencies.
Recently, the crypto market hit a historical high of 3 trillion dollars indicating a growing interest in the industry.
Being one of the largest cryptocurrencies, SHIB will benefit from this shift . As demand grows, the coin is likely to grow in price helping reverse the current trend.
Although the result will not be immediate, the price will inevitably rise in the long term.
SHIB coin burning
The process of coin burning continues at an increasing pace. This focuses on reducing the number of coins in circulation in the long term.
Already, about 41% of all SHIB coins are in a dead wallet. This means they are out of circulation and the percentage keeps increasing.
The purpose of this burning is to ensure the coin remains deflationary.
Coin burning criticism
Numerous coin fans are putting pressure on the acceleration of burning.An average of 700 million SHIB was burnt last week which is a small amount considering there are over 500 trillion coins in circulation.
Mathematically, it will take over 150 years to just burn 1% of circulating coins at this rate. Hence the reason why most people want this accelerated.
It remains to be seen if there will be a change in future. However, as long as there is a persistent supply reduction, this will eventually trigger the price to rise.
NFT market growth
SHIB network recently launched its own NFT tokens known as Shiboshis enabling it to compete in the fast-rising NFT industry.
It prides itself on having the first meme images with an NFT utility capability. There are currently at least 10,000 Shiboshis.
The Shiboshis launch was a success as they have already recorded an average of 30% gain on the Opensea Platform.
Since its introduction in 2015, the transaction of digital assets continues to grow at a steady pace with daily transactions amounting to millions of dollars.
The market is still in its early days with huge growth potential in the future.