SHIB Leads Crypto Markets, Soaring More Than 15% Overnight

The price of Shiba Inu (SHIB) has spiked today, currently up 15.2% over the last 24 hours and 31.2% over the past seven days, per CoinGecko.

SHIB is currently ranked the 13th-largest digital asset by market capitalization, but its price of $0.000012 is having one of the best days out of the top 100 cryptocurrencies. The meme coin is also posting a nearly 200% increase in 24-hour trading volume, with Binance and Coinbase hosting the majority of those trades.

As has often been the case in previous market cycles, altcoins are experiencing strong rallies subsequent to those of the market leaders, such as Bitcoin and Ethereum—perhaps due to traders reinvesting profits from large-cap assets into smaller ones.

The amount of SHIB tokens being transferred to exchanges saw a massive spike on January 10, when over 14 trillion tokens were deposited on exchanges, according to data from CryptoQuant. In relation to today’s price rise, this would suggest that holdings may be being used to open derivative positions rather than being sold in the spot market.

However, if the current SHIB price action is rooted in the derivatives market, it could experience increased volatility if long positions begin to liquidate.

Is SHIB more than a meme?

Earlier this week, the team behind Shiba Inu announced that it is building its own layer-2 network, called Shibarium, to operate atop Ethereum. 

The team acknowledged in its blog post introducing the project that "some see Shibarium as a price pumping tool, but that is not the project's focus and never has been." 

Rather, the team argues that its new layer-2 network will minimize costs and increase transaction speeds for the tokens in its ecosystem.