Dogecoin (DOGE) rival Shiba Inu (SHIB) might be performing poorly as of late, but the memecoin can still have a positive future, according to crypto analytics firm Santiment.
Santiment says that the Shiba Inu network is suddenly seeing a massive increase in activity, indicating a possible incoming move to the upside.
“Shiba Inu has seen a big rise in new daily addresses created, consistently over 2,500 per day in the past couple of weeks. Despite the underwhelming price performance, our latest insight covers why there’s promise behind one of 2021’s favorites.”
According to Santiment, SHIB ranked among the top tokens on Wednesday based on the amount of transaction fees.
Other promising indicators for SHIB include token holders largely underwater and a decreasing supply on crypto exchanges.
Says Santiment,
“A closer look at the underlying trends suggests there might be a positive spin to this development for Shiba Inu. The drivers include network growth, network realized profit loss completely underwater, and decreasing supply of SHIB on exchanges.”
Looking at Network Profit/Loss (NPL), Santiment says there is “only loss visible yet,” which could indicate a trend reversal may be coming.
According to Santiment’s chart, about 8.6% of SHIB’s supply is on crypto exchanges, down from about 9.1% in June. A declining supply on crypto exchanges could mean the selling pressure for Shiba Inu is declining.
Santiment says the new demand for SHIB could soon ignite a price rally.
“The recent attention could breathe new life to a previously under-the-radar token. As suggested by our proprietary metrics, daily active addresses for SHIB were lackluster before this surge in interest, indicating a newfound demand for the token.”
However, Santiment warns that the uptick in interest could also “be interpreted as a sign of market saturation or possible future decline.”
Shiba Inu is trading for $0.00000728 at time of writing, down 1.7% in the last 24 hours.
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