- Shibarium has seen a decline in user activity in the past two weeks.
- SHIB’s Chaikin Money Flow hints at the possibility of a price decline.
Daily transaction fees on Shiba Inu’s [SHIB] Layer 2 (L2) network Shibarium have fallen to their lowest level since the beginning of the year, according to data from Shibariumscan.
AMBCrypto found that the total amount recorded by the L2 network in transaction fees cratered to a low of 4.02 BONE, amounting to $4 on 29th March. This represented a 97% decline from the year-to-date (YTD) high of 211 BONE Shibarium recorded on 4th January.
Source: Shibarium
Why transaction fees plunged on the network
The decline in transaction fees on Shibarium is due to the sudden fall in user activity on the L2 network since 18th March.
According to Shibariumscan, the daily count of active addresses completing transactions on the network rose to its YTD high of 2482 on that day before trending downward.
As of 29th March, only 835 unique addresses were active on Shibarium. This marked a 66% decline in blockchain network activity within two weeks.
Further, new demand for the L2 platform has also dwindled during the period under review. AMBCrypto found that the count of new addresses created daily on Shibarium has since dropped by 85%.
Due to the decline in new demand and user activity on Shibarium, the number of new transactions completed on the L2 network daily has dropped significantly in the last month.
As of 29th March, the number of new transactions executed on the network totaled 172,285. This marked a 96% decline from the 3.92 million new transactions completed on 20th February.
Look out for this
At press time, SHIB was worth $0.0000306. The general market’s rally last week impacted the memecoin, which, according to CoinMarketCap’s data, rose by 12% in the past seven days.
An assessment of its key momentum indicators on a daily chart revealed that the price rally has been backed by a steady demand for the altcoin. For example, its Money Flow Index (MFI) trended upward to return a value of 71.19.
Likewise, the coin’s Relative Strength Index (RSI) rested above its center line at 58. 06. These values showed that market participants have favored SHIB accumulation over its distribution in the last week.
Read Shiba Inu’s [SHIB] Price Prediction 2024-25
However, while buying activity may exist, readings from SHIB’s Chaikin Money Flow (CMF) showed that it may not be strong enough to initiate a significant surge in the coin’s value in the short term.
The coin’s CMF indicator measures the flow of money into and out of the asset. At the time of writing, it was resting on the zero line and poised to form a bearish divergence, which may be followed by a decline in SHIB’s price.
Source: SHIB/USDT on TradingView
