In a surprising turnaround, Shiba Inu has lost 43.634 holders of its SHIB token in the past five days, according to graphs from CoinMarketCap.
The website's graph also shows that as of December 21, 2021, the cryptocurrency SHIB added 118.695 new users to a peak of holders at 1.199.453 on March 15, 2022, then lost the equivalent of 34% of that quarterly volume over the past five. days.
The Fed rate hike may have been the catalyst for SHIB
The timing of the decline in Shiba Inu owners is no coincidence. Last Wednesday was when the Federal Reserve announced it would raise interest rates by 0,25% - the first of several hikes expected this year.
This rate hike may have been the trigger for Shiba Inu owners. This flight from risky investments was predicted in January by Bloomberg's chief commodity strategist Mike McGlone in his research report titled - "Crypto Outlook: Don't Fight the Fed" - which predicted the impact of rate hikes. of the Fed on cryptocurrencies.
As interest rates rise, investors tend to migrate from high-risk speculative investments to safer options like bonds, which offer higher yields. According to McGlone, this financial leak would damage SHIB and Dogecoin harder than other crypto assets.
“Crypto is on top of speculative excesses and may be an early indicator that the tide of the broader market is set to recede. The peaks of Dogecoin and Shiba Inu meme coins coincide with similar market highs, emphasizing the leading indications of crypto, ”McGlone said in his report.
What he is saying is that investments that go up a lot and fast generally mark a similar drop, which is what happened with SHIB and Dogecoin. McGlone labels those tokens as "highly speculative" within the already volatile crypto asset class.
Should you buy or sell Shiba?
The SHIB token was launched in August 2020 as a big joke, but meanwhile SHIB has skyrocketed, more than 49.000.000% in 2021. This has made millions of early adopters millionaires and caused a flood of followers who flocked to the project.
Since then, developers have deserved credit for desperately trying to turn SHIB into a legitimate crypto by building more value and use into its ecosystem. They launched a decentralized exchange, non-fungible tokens (NFTs) and complementary crypto with different use cases. There is also a SHIB-based blockchain under construction to move the entire Shiba Inu platform from the Ethereum network.
And potential investors are taking notice of the updates. Indeed, last week the country's finance minister of Turkey announced exploratory discussions to make SHIB an alternative currency and a hedge against the 191% inflation rate in that country.
At the time of writing, SHIB has a quotation of $ 0,00002302, down 73% since it hit an all-time high of $ 0,00008845 in October 2021. Shiba Inu's total market cap is currently $ 12,6 billion, and at that valuation it is financially impossible for it to double its percentage increase from last year.
