Shiba Inu Faces Fresh Downside: A 5%+ Pullback Amid Market Headwinds and Supply Concerns

Shiba Inu has experienced a notable retreat over the past day, with the token sliding more than 5.7% as of recent trading data. While this decline aligns with broader cryptocurrency market weakness—the entire digital asset space has contracted roughly 0.8% in the same period—several token-specific dynamics appear to be weighing on SHIB’s price action.

The Dual Pressure: Macro Trends Meet Token Realities

Market conditions have turned decidedly unfavorable for high-risk assets. Speculative tokens, particularly those positioned at the fringe of the sector like Shiba Inu, tend to absorb disproportionate selling pressure during downturns. The combination of reduced risk appetite across markets and increased liquidation activity has created a challenging backdrop for SHIB holders.

Beyond these macroeconomic headwinds, observers point to growing concerns about token-specific fundamentals that merit closer inspection.

The Supply Challenge: Why Token Circulation Remains a Pressure Point

The crux of Shiba Inu’s longer-term valuation puzzle centers on its massive circulating supply: approximately 589.4 trillion tokens currently in circulation. This enormous token count has historically created deflationary pressure on price, as the network’s market value gets divided across an increasingly large token base.

To address this structural challenge, the Shiba Inu ecosystem has leaned heavily on token burn mechanisms as the primary tool for reducing supply and theoretically supporting price appreciation. To date, the community has successfully removed over 400 trillion tokens from circulation through these burn events.

However, recent developments have tested investor confidence. Data from this morning revealed a sobering reality: the daily token burn count had stalled at zero. This pause in burn activity, combined with ongoing bearish momentum, suggests that near-term catalysts for recovery may be limited.

What’s Next?

For holders and observers alike, the critical question revolves around whether the burn ramp will resume at meaningful levels. Until then, Shiba Inu appears caught between the headwinds of macro market weakness and the persistent reality of token oversupply—a combination that explains today’s sharper-than-average decline.