Is Shiba Inu a Good Investment?
In the cryptocurrency market, Shiba Inu (SHIB), as a well-known MEME coin representative, its price fluctuations and investment potential have always been a controversial focus. As of May 2025, SHIB has experienced a 7.4% decline within a week, but it still attracts the attention of institutional investors and retail investors. This article will analyze the investment value of SHIB from multiple perspectives such as fundamentals, technical aspects, market sentiment, and provide strategic advice for investors.
The recent performance of SHIB and market dynamics
Price fluctuations and institutional accumulation
From April to early May 2025, SHIB price From a peak of $0.00001375 to $0.00001274, a decrease of 7.4%, mainly due to overall market downturn pressure and macroeconomic uncertainty. However, on-chain data shows that institutional investors continued to increase their holdings during this period, adding 109 “whale wallets” holding at least $1 million worth of SHIB in April, bringing the total to 860. This phenomenon indicates that despite short-term price pressure, long-term confidence is still accumulating.
Progress of Shibarium
The Layer-2 network Shibarium in the SHIB ecosystem continues to be optimized, focusing on improving transaction throughput and validator participation. This technical upgrade aims to address network congestion issues and drive the development of decentralized applications (DApps). In addition, the collaboration with Chainlink further enhances its cross-chain interoperability, laying the foundation for future ecosystem expansion.
Potential Upside Momentum for SHIB
High correlation with Bitcoin
The correlation coefficient between SHIB and Bitcoin prices is 0.82. If Bitcoin breaks through $100,000 in Q2 2025, SHIB may benefit simultaneously. Historical data shows that during the uptrend of Bitcoin, meme coins often see larger gains. For example, from the end of 2024 to the beginning of 2025, SHIB once surged 157% driven by Bitcoin.
Burning mechanism and deflation expectations
The SHIB community reduces circulation by burning tokens. In April, the daily burn surged by 690%, destroying over 32.3 million tokens in a single day. Although the current burn rate has limited impact on price, continuous large-scale destruction in the long term may boost the coin price through the deflationary effect.
Market sentiment and speculative demand
The outbreak of MEME Coin usually occurs in the late stage of a bull market. The open interest of SHIB futures contracts in the current market doubled to $190 million in April, showing the enthusiasm of leveraged traders. If Bitcoin leads a new bull market, SHIB may see a short-term surge like in 2021.
The main risks facing SHIB
Lack of fundamental competitiveness
Despite the frequent introduction of new concepts by the project party (such as the metaverse and the ShibaSwap exchange), the actual ecological data is weak. The total value locked (TVL) of ShibaSwap is only $20 million, far below mainstream DApps, and user activity is low. Holding data shows that 77% of SHIB is concentrated in whale addresses, and 75% of holders are in a state of loss, reflecting a lack of new capital inflow in the ecosystem.
Technical patterns and market pressures
From a technical perspective, SHIB has formed a key support near 0.0000127 US dollars recently, but the upper resistance at 0.0000129 US dollars has not been broken through. If it falls below the support, it may further test 0.000005 US dollars. In addition, the monthly chart of SHIB has continuously shown long upper shadow lines, indicating insufficient rebound momentum, and the downside risk should be guarded against.
Overreliance on market speculation
The essence of SHIB is still a MEME coin, and its price highly depends on market sentiment rather than actual application. For example, in April 2025, a new project Ruvi AI (RUVI) attracted funds with its technological narrative, while SHIB performed flat due to a lack of breakthrough progress. If the market focus shifts, SHIB may face pressure from capital outflows.
Investment strategies and advice
- Short-term trading: Pay attention to the $0.0000127 support level and the $0.0000144 resistance level, combined with the RSI oversold signal (currently 35.02) to capture rebound opportunities.
- Long-term holding: If SHIB breaks through 0.00003 US dollars and stabilizes, it may start a medium-term uptrend, with a target towards 0.00004 US dollars.
Given the high volatility of SHIB, it is recommended that users control their positions between 10%-20% and avoid leveraged trading. At the same time, pay attention to the progress of the ecosystem (such as the Shibarium upgrade) and the trend of Bitcoin as signals for buying or stop-loss.
Some analysts believe that if Bitcoin breaks through $100,000 in Q2 2025, SHIB may rise by 182% to $0.00004, returning to the 2021 high. However, some also point out that SHIB needs to break through fundamental bottlenecks (such as the landing of ecological applications) to break free from the cyclical dilemma of MEME coins.
SHIB Future Outlook
As a representative of MEME coins, SHIB presents both investment opportunities and risks. Short-term speculators can profit from technical fluctuations, while long-term investors need to closely monitor ecological progress and market cycles. In the volatile cryptocurrency market, diversification and strict risk management are still prudent strategies.
