Shiba Inu Faces Unprecedented Downturn Amid Massive Burn and Market Liquidation

Shiba Inu (SHIB), the meme‑coin that once surged to a 52‑week high of $1.33219 × 10⁻⁸ in late July, is now grappling with a confluence of negative forces that have driven its close price to $3.48299 × 10⁻⁹ on 2025‑10‑09. The market cap, a mere $2.1 million, sits at the lower end of its historical range, and the 52‑week low of $2.04101 × 10⁻⁹ has been breached again.

1. Record‑Setting Token Burn

Between 10 and 11 October, Shiba Inu’s community executed a staggering 9.7 million token burn, an event that eclipses prior burn volumes by a factor of 13,120 %. The burn rate surged from a modest figure to a dramatic 11,822.57 % in a single day, destroying 9,782,588 SHIB tokens and reducing the total supply to 589 billion tokens. While the intention behind such burns is to tighten supply and potentially lift prices, the immediate aftermath has been a sharp liquidity contraction and a steep price decline.

2. Massive Liquidation Event

A concurrent market‑wide liquidation event wiped out $19.38 billion in crypto positions, with Shiba Inu’s metrics plummeting in tandem. The sheer scale of the liquidation, the highest on record, has amplified volatility and amplified selling pressure across all meme‑coins, with Shiba Inu experiencing the most pronounced dip.

3. Price Collapse to 2024 Lows

Shiba Inu’s price has fallen to $3.48299 × 10⁻⁹, matching lows first seen in January 2024. Analysts note that this level is approaching a critical support zone, and any further downward momentum could trigger additional panics among retail holders.

4. Liquidity Drain

Liquidity data indicates a rapid exodus of tokens from exchanges. A report dated 10 October highlights 142 billion SHIB removed from exchange wallets, further tightening the market. The liquidity drain has been compounded by the burning of tokens that were once actively traded, leaving fewer circulating supply for market participants.

5. Security Concerns and Phishing Attacks

Amid the price chaos, scammers have intensified phishing campaigns targeting the Shiba Inu community. A recent alert warned of “free” Shiba Inu tokens that turned out to be a trap, involving malicious airdrop sites and fake reward platforms. The confluence of market stress and security breaches has eroded confidence among holders, exacerbating selling pressure.

6. Broader Market Sentiment

While some meme‑coins like Dogecoin and Pepe have shown brief upticks, Shiba Inu remains under significant bearish pressure. The overall sentiment across the meme‑coin sector is dampened by a broader crypto sell‑off, with market‑wide liquidity constraints and a fragile macro environment.

7. Potential Regulatory Impact

Jack Dorsey’s push for a de‑minimis tax exemption on Bitcoin transactions may indirectly benefit Shiba Inu if broader cryptocurrency adoption increases. However, the current regulatory uncertainty and the lack of clear policy regarding meme‑coins mean that any positive legislative change is unlikely to reverse the immediate downward trend.

Bottom line: Shiba Inu’s unprecedented token burn, coupled with a record‑setting liquidation event and a steep liquidity drain, has pushed the coin to a precarious 2024‑low price. Coupled with ongoing security threats and a bearish market environment, the future trajectory remains uncertain. Investors should monitor liquidity metrics, burn announcements, and regulatory developments closely before making further commitments.