Shiba Inu (SHIB), one of the biggest memecoins on the market, is still far from its glory days. The token is trading more than 90% below the all-time highs it hit in October 2021.
Even with gains of around 5% during the April price action, the recovery looks limited in the broader context—especially as investors weigh the long-term forces that can either lift the token or keep it pegged.
There is no rapid shortage, a greater shortage
A recent Motley Fool report points to several structural factors that have helped shape the Shiba Inu’s current performance and may continue to influence further development.
One of the biggest problems is the coin supply. The total supply of SHIB is approximately 589.5 trillion tokens, and almost all of that supply is already in circulation. Although a large part has been removed from circulation in 2021, the remaining amount is still so large that it does not change the overall picture.
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The report emphasizes that the volume of supply makes it difficult to squeeze the Shiba Inu in a way that would significantly affect the price.
To illustrate how challenging it would be to meaningfully reduce the supply, the report notes that even if 1 trillion tokens were permanently removed every day for an entire year, hundreds of trillions would remain. In practical terms it means supply-driven scarcity it is unlikely to happen quickly enough to cause significant repricing.
At the same time, the report highlights a key downside that works in the opposite direction: There is no comparable built-in mechanism that rapidly reduces supply when demand weakens.
Near Zero Warning for Shiba Ina
The report also warns of the risk of a slow, sustained decline. It suggests that as investor attention fades and capital turns to other cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH), SHIB’s combination of high supply and limited scarcity could leave it vulnerable to continued downward pressure.
In that scenario, the report goes so far as to say that the Shiba Inu could fall toward near-zero levels by the end of 2026, not as a sudden collapse, but as a result of prolonged weakness.
Apart from supply mechanics, the report also points to SHIB’s ownership and distribution. He claims that the token supply is concentrated in a small number of wallets. According to the report, the top 10 wallets hold more than 60% of the total SHIB supply.
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This is important because SHIB’s price, the report suggests, is heavily influenced by trading behavior—who buys and who sells at any time. When large holders control a significant portion of circulating tokens, their decisions can have a huge impact.
If several large wallets decide to sell, the additional supply can affect the price. At the same time, the report notes that many of the remaining Shiba Inu owners are small retail investors, who typically have limited capital to absorb large sell orders.
The report links this to a cycle of reinforcement. As Shiba Inu prices fall, investor interest often wanes further. This can lead to reduced trading volume and reduced liquidity, which then makes the market more sensitive to sales pressure.
At the time of writing, SHIB was trading at $0.0000063, up a slight 1.8% over the past seven days.
Featured image created using OpenArt, chart from TradingView.com
