Why Shiba Inu Just Tanked 5.7% — And What It Really Means

Shiba Inu took a proper tumble today. While the broader crypto market only dropped around 0.8% over the last 24 hours, SHIB found itself among the worst performers, sliding 5.7% since yesterday at this time. For those tracking this meme coin, it’s the latest in a string of downward pressure moves that’s got the community asking hard questions.

The Broader Context: Risk Assets Getting Hammered

Let’s be clear — Shiba Inu operates in one of the most volatile corners of crypto. As a leading meme token, SHIB swings harder than most assets, which cuts both ways. Sure, when sentiment turns bullish, these kinds of coins can explode upward faster than traditional assets. But lately, the tide has turned. Speculative assets across the board are facing serious headwinds, and bears have basically taken control of the narrative right now.

In this environment, a 5.7% daily drop doesn’t exactly shock anyone. Investors in meme coins should already know they’re signing up for this kind of volatility. The real question isn’t whether Shiba Inu will continue swinging — it’s what’s actually driving these moves.

The Real Problem: Supply Dynamics Haven’t Improved

Here’s where things get concerning for long-term holders. Shiba Inu’s massive circulating supply of 589.4 trillion tokens has been an albatross around the project’s neck. Think about it simply: every time more tokens exist, the same market cap gets divided into thinner and thinner slices. Existing holders end up with a smaller piece of the pie, which creates natural downward pressure on price.

The Shiba Inu team recognized this problem and promoted token burns as a potential solution — the idea being that removing tokens from circulation permanently could help unlock price appreciation. The community has already burned over 400 trillion tokens to date, showing real commitment to this approach.

But here’s the problem: token burn activity hit zero over the past day. The momentum that supporters were banking on has stalled, at least for now. Combined with intensifying liquidations and relentless bearish sentiment rippling through the market, Shiba Inu’s near-term prospects have clearly deteriorated.

For anyone tracking this coin, the burn rates are worth monitoring closely. Without consistent token reduction, inflation remains a structural headwind that could keep downside pressure intact.