Why Shiba Inu's Market Momentum Is Stalling: Breaking Down SHIB's Core Challenges

Shiba Inu faces a confluence of mounting headwinds that are reshaping investor sentiment. While the token maintains modest daily gains of 2.3%, the broader picture reveals concerning weakness. SHIB has declined 12.4% over the past month and lost 64.5% since January—a trajectory that contradicts long-term bullish narratives still circulating in the community.

The Burn Engine Is Running on Empty

When Shiba Inu launched in 2020 with 1 quadrillion tokens, the burn mechanism was positioned as a core supply-reduction strategy. The circulating supply still stands at 589.24 trillion tokens. However, recent burn activity tells a starkly different story.

Burn rates have collapsed by 89.96% in just 24 hours, with only 1.09 million tokens reaching dead wallets. This represents a dramatic departure from historical patterns, when community trackers reported billions burned daily. Current burn volumes have shrunk to negligible levels, effectively removing a key catalyst for price appreciation. Without meaningful supply reduction, the token loses one of its primary value propositions.

Shibarium’s Promise Remains Largely Unfulfilled

Launched in August 2023 as a Layer-2 developer hub, Shibarium was intended to unlock new utility for SHIB and its ecosystem tokens (BONE, LEASH, TREAT). Instead, the network has struggled with adoption. Projects built on Shibarium remain largely dormant, and sister tokens continue to show minimal real-world usage.

The broader development roadmap shows similar stagnation. Flagship initiatives including SHIB: The Metaverse and the SHIB Marketplace—both promised for 2024—remain unfinished. The Layer-3 privacy blockchain has received no meaningful updates. Additionally, recent community friction emerged when certain team-aligned accounts promoted external projects, creating concerns about divided focus and capital allocation within the ecosystem.

Transparency Gaps Eroding Confidence

A persistent structural issue undermines long-term investor confidence: core development has historically operated under pseudonyms. Even high-profile team member shytoshi kusama has maintained an obscured public identity. This opacity extends to communication channels, where activity from major developers and core team members has notably declined across public platforms.

Unresolved technical incidents amplify these concerns. The team has ceased responding to community inquiries regarding fund recovery from the Shibarium exploit, leaving substantial questions unanswered. Such communication breakdowns, combined with delayed product launches and vague updates on major initiatives, create credibility gaps that institutional and long-term retail investors increasingly find difficult to overlook.

The Road Ahead Remains Uncertain

Shiba Inu’s trajectory hinges on meaningful execution: restarting burn mechanisms at scale, delivering on-chain utility through completed products, and restoring transparent communication channels. Until these shifts materialize, the token’s positioning as a long-term investment continues to weaken relative to alternatives offering clearer development roadmaps and more predictable tokenomics.