Shiba Inu's most recent on-chain dynamic has been extremely volatile: With more than 50 trillion SHIB transacted a few days ago, we recently saw a rapid retrace of that metric, delivering only 1.4 trillion SHIB in transactional volume in the last 24 hours.
The WazirX exchange hack's aftermath was largely blamed for the recent massive transaction, which involved 50 trillion SHIB. A large amount of SHIB was dumped on the market as a result of this incident, which might have had a negative effect on its price.
SHIB/USDT Chart by TradingView
But because of market makers like Wintermute who intervened to stabilize the market by purchasing SHIB from decentralized exchanges and depositing it to centralized exchanges for arbitrage purposes, the effect was limited.
The sharp decline in transaction volume to 1.4 trillion SHIB raises the possibility that the initial sell-off and panic have eased. It suggests that either the whales or large holders of SHIB who may have been responsible for the massive sell-off have completed their transactions or are delaying more significant moves for the time being.
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At first there was concern that SHIB would drop significantly in price, but it was able to hold its support levels around $0.00001778. Price stability demonstrates the strength of SHIB's market support by showing that the market has absorbed the excess liquidity without experiencing a significant correction.
Examining the transactional activity data we find that the quantity of large transactions has declined dramatically, which is consistent with the volume decline as a whole. In the near run, this trend may continue as the market steadies and investors start to feel more confident. Furthermore, for SHIB to prevent additional volatility, holding onto the current support levels will be essential.
