Why Is The Shiba Inu Price Crashing Today?
August 05 2024 - 12:30PM
NEWSBTC
With the Bitcoin price crash over the weekend, the prices of other
cryptocurrencies such as Shiba Inu have followed sharply. The
result of this has been a double-digit price crash for Shiba Inu,
alongside other altcoins. Naturally, the rapid decline has raised
questions, with industry stakeholders wondering what is driving
this massive crash. Shiba Inu Price Crash Is Following Bitcoin The
Shiba Inu price crash being experienced today is not a result of a
single event occurring for the meme coin. Rather, it is linked to a
further market-wide crash that began with the Bitcoin price first
falling below $60,000 and eventually breaking $50,000 on Monday.
Therefore, to get the real reason behind the Shiba Inu price crash,
we must look at the reason driving the Bitcoin crash. Related
Reading: MATIC: Market Nosedive Leads To 30% Wipe In Value So far,
Bitcoin, and the broader crypto market, has been responding to
major events happening around the world. These are outline by pro
trader Adam Khoo in an X (formerly Twitter) post, revealing a much
deeper reason for the decline. One of these major events is the
decline in the Japanese stock market, which is seeing its largest
single-day decline since 1987. As Khoo outlined, traders on the
Japanese stock exchange had borrowed the Japanese Yen at low
interest rates to convert to United States Dollar, which is, in
turn, used to buy US stocks for a larger gain. This strategy has
worked for the trader as Yen’s interest rates remained low.
However, the Japanese government raised interest rates, meaning
that these traders were now dealing with massive losses as the Yen
strengthened against the US dollar. The result of this is a large
sell-off as traders scramble to pay back their loans while taking
huge losses in the process. Naturally, this led to a decline in US
stocks and the likes of Bitcoin and Shiba Inu have been reacting to
this market decline. The sharp rise in the JPY/USD is causing a
massive unwind of Yen carry trade positions and contributing to the
sharp decline in US stocks. For those who do not understand how
this works, a brief explanation 1) Many traders were borrowing Jap
Yen (JPY) at low interest rates,… pic.twitter.com/sfi0Hva56M — Adam
Khoo (@adamkhootrader) August 5, 2024 Not only this, other major
events such as war escalation in the Middle East, as well as the US
presidential elections having no clear winner yet, has driven
prices down further. With fear and panic spreading, more investors
are selling, causing an already deep decline to depend further.
Related Reading: Dogecoin Price (DOGE) Slips Alongside Bitcoin and
Ethereum: Market Analysis However, while investors in assets such
as Shiba Inu panic, the crypto trader does not believe that it is
all bad. According to him, this is a great time to “take advantage
of temporary mis-pricing caused by short term crisis.” Presently,
the Shiba Inu price is sitting at $0.00001111 – its lowest level in
six months. Going by the trader’s sentiment, this could be a good
time to get into coins such as Shiba Inu, as a rebound from here
could lead to new all-time highs. Featured image created with
Dall.E, chart from Tradingview.com
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