1. The significance of the surge in the destruction rate

  1. The principle of destruction mechanism:
    Burning means permanently removing tokens from the circulating supply. In theory, this is a measure to reduce market supply, increase scarcity, and should help prices rise.

  2. SHIB destroyed 936%:
    Such a high destruction rate may come from large wallets, community activities or direct execution by the team. This "amplified deflation effect" usually excites the market. But the question is, do these destruction behaviors really affect the market? Especially for Meme coins with high circulation like SHIB, the impact of a one-time destruction on the total supply may be a drop in the bucket.

2. Possible Reasons for Price Decline

  1. Supply and Demand Imbalance: Destruction Insufficient to Counter Selling Pressure
    Although destruction reduces supply, prices in the crypto market are primarily determined by buying and selling demand. If selling pressure increases in the short term, such as early investors cashing out, whales exiting, or market sentiment cooling, the positive impact of destruction cannot offset the decline caused by selling.

  2. Market Sentiment is Low: Faith Struggles to Support the Market
    SHIB is essentially a meme coin, and its price relies on speculative enthusiasm and community strength. Once sentiment cools, even with more positive news, such as destruction or ecological upgrades, the price may not respond immediately.

  3. Capital Outflow: Switching to Other Coins
    Currently, the crypto space is full of hot topics, with new coins in GameFi, AI concepts, Layer 2, etc., grabbing attention. Funds may flow out of SHIB and into other hot assets.

  4. Whale Influence: Manipulation Disturbs the Market
    Many whales may profit by selling first and buying back later. When destruction news is released, they might choose to sell into the momentum, attracting retail investors to push the price up before buying back at a lower point, completing a profit-taking cycle.

  5. Macro Environment Drag: Overall Market is Poor
    If the entire crypto market faces liquidity issues (e.g., when BTC and ETH drop), meme coins are particularly vulnerable. SHIB is a high-risk asset and is among the first targets to be liquidated.

3. The Impact of This Destruction on the Future

In the short term, this destruction is mainly a stimulus from news, more like an eye-catching marketing strategy; but in the long term, it could have potential benefits for SHIB's economic model. If destruction continues and the circulating supply is significantly reduced, combined with a recovery in the bull market and the realization of ecological construction results, it still has certain rebound and growth opportunities.

4. Coping Strategies: How to View SHIB's Future?

  1. Seizing the Hot Spot Effect:
    If the decline triggers larger emotional fluctuations, potential opportunities at lower levels may be worth considering, but do not overly rely on destruction or short-term news for trading.

  2. Assessing Long-Term Value of the Project:
    Apart from being a meme coin, SHIB's ecological expansion capabilities (such as Shibarium, NFT market, community autonomy) are also worth observing. Can these support it in becoming a lasting network effect?

  3. Diversifying Risk Investments:
    Never put all your funds into a single meme coin; it is more like a highly volatile short-term lottery ticket that requires scientific fund management and profit-taking and stop-loss strategies.