Shiba Inu Struggles in the Market Amidst New Meme Coin Launches

A quick look at the meme coin space will show that more tokens are being put out than ever before. While the asset class was controversial when it first launched, it has seen one success after the other, and investors are certainly taking note. As Alan Draper explains, consumers are constantly looking for the next meme coins that will explode in value. But while new meme coins are becoming highly coveted, a more established token appears to be struggling. 

Shiba Inu, which is one of the best-known dog-themed tokens, has seen a record-high burn rate, as well as a significant dip in value. For the week ended September 21, 2024, the token traded at $0.00001442, which is a far cry from its year high of $0.00003541 and an 83% dip from its all-time high. 

The decreased interest in the token is especially notable considering its performance in the futures market. Shiba Inu’s open interest in the market is pegged at around $24 million, a massive drop from the $137 million it saw earlier this year. Finally, we have to consider the token’s burn rate, which jumped by a whopping 440% in just 24 hours.

On the surface, it would seem puzzling. After all, Shiba Inu has the sort of recognizability that other meme coins can only dream of and is deemed second only to Dogecoin itself. Why then is it performing so poorly?

Much of this is put down to the expansion of the meme coin space. A few years ago, there were only a handful of prominent meme coins for investors to turn to. But 2024 has been an especially good year for meme coins as several profitable ones have launched. From PlayDoge to Pepe Unchained, meme coin presales have raised millions and become some of the most hyped projects in the industry. 

It is also worth noting that tools like Pump.fun and SunPump have hit the scene, making it easier for people to launch their own meme coins. It is no secret that the crypto industry has more investment opportunities than ever before and many investors are more drawn to the shiny new options compared to established tokens like Shiba Inu. 

The asset is in an interesting place where its price has declined and could drop past crucial resistance points over the next few months if there is no trend reversal. At the same time, Shiba Inu is still the second most valuable meme coin in the industry and could very well see it make a recovery as 2024 comes to an end. 

The industry goes in cycles and should there be a market contraction, investors might turn towards tried and tested options like Shiba Inu. There is also the possibility of the token getting its own spot ETF, which would see it following in Bitcoin and Ether’s footsteps and benefit from price. 

Only time will tell if this is a temporary setback or the beginning of the end of Shiba Inu.