On-chain data shows that Shiba Inu whales have been leaving exchanges recently. Here’s what this means for SHIB’s price:
Recently, the supply of Shiba Inu on the exchange has plummeted.
As the analyst pointed out post In X, the supply of Shiba Inu on the exchange has recently decreased dramatically. “Exchange Supply” means an indicator that tracks the percentage of total Shiba Inu supply held in wallets on all central exchanges.
If the value of this indicator goes down, it means that investors are currently transferring a net number of coins from these platforms to self-managed wallets.
Typically, the main reason holders move their coins this way is to hold them for the long term. Naturally, this accumulation can have a positive impact on cryptocurrency prices.
On the other hand, an increase in the value of the indicator may turn out to be a bearish signal as holders may deposit their coins on exchanges for selling purposes.
Below is a chart showing the Shiba Inu supply trend on the exchange over the past few months.
The value of the metric appears to have observed a plunge in recent weeks | Source: @trader_kamikaze on X
As you can see in the graph above, Shiba Inu exchange supply has seen a significant decline over the past month. In total, approximately 0.51% of the asset’s total circulating supply left the platform during this period.
Interestingly, most of these large withdrawals have occurred in conjunction with recent asset price gains. These outflows are likely a buying signal from whales, which is why the net worth of meme coins has risen during this period.
However, after the local high, SHIB has now seen a notable decline. But despite this, investors appear to have yet to react negatively to the plunge as more withdrawals continue to occur.
Foreign currency outflows can have a short-term impact on prices, but the trend can also point to something bigger. For the stability of a cryptocurrency, it is important that no large central authority controls a significant portion of the supply.
Crashes like FTX in 2022 have shown how interconnected the market is with these platforms. However, if coins continue to flow out of reserves, the market may behave in a more independent manner in the future.
Shiba Inu have seen supply flowing out of exchanges over the past few months, which is certainly a positive development. After the recent leak, only 7.85% of the current Memecoin supply remains under the control of a central authority.
SHIB price
Shiba Inu crossed the $0.00001000 level a few days ago, but the meme coin has since fallen to $0.00000942.
Looks like the price of the coin has gone up during the past couple of weeks | Source: SHIBUSD on TradingView
Featured image from Shutterstock.com, chart from TradingView.com, Santiment.net