Following the introduction of the anticipated Ethereum Layer 2 protocol Shibarium, Shiba Inu is falling further below $0.00001. SHIB is trading at $0.00000908 on Thursday, a decline of 8%, with the potential to revisit lower support levels.
Shiba Inu has maintained a positive outlook since mid-June, with the price increasing from $0.000006 to $0.00001130 in August. As the launch of the Shibarium mainnet protocol drew near, investors bought SHIB in anticipation of a price increase.
Given that declines marked Shibarium’s launch, it can be deduced that the event had been priced with profit taking in mind.
The situation was exacerbated by technical issues that arose after the publication of the protocol. According to information from Chinese crypto reporter Colin Wu, the Layer 2 solutions protocol abruptly ceased producing blocks and is currently pending.
By citing Beosin’s monitoring data, Wu stated, “$1.7 million worth of ETH is locked on the Shibarium cross-chain bridge.”
The SHIB community was particularly perturbed by the news, especially after a successful test run in which testnet reached the remarkable benchmark of 21 million wallet addresses.
According to a CoinGape report, Shibarium momentarily returned online. According to block count data, the most recent protocol transaction occurred approximately five hours ago. In the meantime, developers are working on a recovery procedure for the bridge-bound assets.
The community is concerned that Shibarium’s current difficulties are only the tip of the iceberg, with security, safety, and scalability issues likely to follow. Beosin has advised investors to avoid the Shibarium protocol until the problems have been resolved.
Shiba Inu Price Dips
Although not minor, the issues plaguing Shiba Inu make the meme coin susceptible to losses. Moreover, investors will likely continue selling to preserve their gains over the past few weeks.
According to market reports, most of the selling pressure in SHIB, LEASH, and BONE tokens is caused by whale activity.
With the Moving Average Convergence Divergence (MACD) indicator displaying a new sell signal, the path of least resistance will likely continue to be upwards. Traders seeking exposure to short positions in SHIB would watch for the price to fall below initial support at $0.000009, confirmed by the MACD line crossing below the signal line.
Shiba Inu may rebound from the confluence support created by the 50-day Exponential Moving Average (EMA) (red) and the 100-day EMA (blue) at $0.000008724. However, if losses continue unabated, investors may wish to prepare for SHIB to retest the $0.0000075 and $0.0000065 support levels.
It is also premature to rule out the possibility of a rebound, as Shiba Inu presents opportunities to purchase the dip for another attempt to rally to $0.00002.
