A recent examination by the on-chain analytics service Santiment has shed light on the prevailing sentiment within the Dogecoin (DOGE) and Shiba Inu (SHIB) communities, suggesting that a recovery may soon take place.
Shiba Inu Investors Exhibit Bearish Sentiment
According to a market report, Santiment has pointed out that Shiba Inu investors currently hold a negative outlook on the meme coin. This assessment is rooted in the volume of social chatter surrounding Shiba Inu, which has been reported as “extremely low” since late July. This trend indicates a gradual decline throughout the year as bearish sentiments toward Shiba Inu increase.
The analysis also recognized that the sense of apathy and discontent among Shiba Inu holders is rational, given that smaller retail traders have been rapidly selling off their SHIB assets. Data from the analytics platform IntoTheBlock corroborates that these retail investors lack the bullish enthusiasm one might expect. Notably, Shiba Inu whales now control nearly 60% of the meme coin’s total supply.
Santiment indicated that unlike Dogecoin, retail traders of Shiba Inu are expressing “tremendous relief.” The accompanying graphic illustrated that the percentage of total supply held by wallets containing less than 1 billion SHIB has reached its lowest point since November 2022. This trend suggests a substantial wave of FUD present in the community, with Shiba Inu whales retaining the vast majority of the overall supply.
The negative sentiment prevalent among Shiba Inu investors may also be linked to the coin’s poor performance this year. Santiment remarked that the meme coin has “nearly lagged behind Dogecoin in terms of performance throughout 2024.” The average trading returns over the past 30 days have dropped to about -1.1%, while the long-term returns have plummeted to -31.7%.
However, this pessimistic view regarding Shiba Inu might change shortly as Bitcoin experiences a bullish turnaround. Data from IntoTheBlock indicates a strong positive correlation in prices between the meme coin and Bitcoin. Thus, as Bitcoin rises, Shiba Inu typically follows suit.
Dogecoin Traders Are Uncertain About Their Next Steps
Retail traders of Dogecoin appear to have remained uncertain regarding their decisions about the meme coin throughout this year. Wallets holding less than 1 million DOGE constitute approximately 11.8% of the coin’s supply, reflecting a similar level to that observed at the start of the year. Consequently, Santiment emphasized that there are no signs of FOMO that might indicate these smaller traders are building their Dogecoin positions.
Despite Dogecoin benefiting from the excitement surrounding Tron meme coins in August, this enthusiasm was not reflected in its price. Since then, the ratio of DOGE discussions compared to all cryptocurrency discussions has decreased to 1.28%. Sentiment remains at equilibrium, which Santiment observed is a positive indicator that the FOMO has quickly dissipated. They further noted that should impatience and FUD arise next, it would be a promising sign of a potential turnaround.
Featured image created with Dall.E, chart from Tradingview.com
