Shiba Inu's foreign exchange reserves fall to 84.7 trillion

What happened to SHIB ?

Exchange reserves act as a measure of selling pressure versus holding confidence. When reserves decrease, this typically indicates that tokens are being withdrawn to private wallets, indicating a shift to a long-term holding or staking strategy. For Shiba Inu, the drop to 84.7 trillion represents a significant decline from previous periods when exchange balances were much higher, especially during the peak speculative period of 2021–2022.

This trend is also consistent with overall market behavior, as retail and community-driven tokens are increasingly held off exchanges to access DeFi utilities such as liquidity pools, yield farming, and staking protocols within the Shibarium ecosystem.

In a development that could signal a supply crunch for the beloved meme coin, Shiba Inu (SHIB) exchange reserves have plummeted to 84.7 trillion tokens as of September 25, according to on-chain analysis from CryptoQuant. This marked a staggering outflow of 243.7 billion tokens in just 24 hours – a negative net outflow of -238.2 billion SHIB – far exceeding inflows and underscoring a shift to long-term holdings amid a broader market pullback.

Despite the SHIB price dropping 5% to around $0.0000170, data paints a picture of resilient holder confidence, with whales consolidating nearly 1 trillion tokens into a single wallet via transactions from Kraken and Wintermute. As the global cryptocurrency market cap falls to $3.75 trillion, this withdrawal of reserves – down from $283 trillion just nine days ago – puts SHIB on a potential breakout path, even as short-term volatility remains following the recent $2.4 million Shibarium exploit.

Beyond memes to become utility games

Launched in 2020 as a rival to Dogecoin, SHIB has grown from a virtual sensation to a full-fledged ecosystem, with Shibarium processing 1.5 million transactions per day and the ShibSwap DEX TVL approaching $500 million. The drop in reserves to 84.7 trillion – about 14% of the circulating supply – reinforces the “diamond hand” thesis, especially after the Shibarium validation exploit caused the price to drop 5% but failed to trigger a mass sell-off. Key factors include:

• Burn Growth Momentum: Burn rate spiked 396%, with 170 billion tokens “disappearing” in recent weeks, aiming for another 300 billion tokens through community initiatives.

• Whale Activity: Concentrated purchases amid chaos, minimizing sell-off risk.

• ETF Rumors: Speculation on SHIB spot ETFs, similar to Dogecoin's filing, could drive capital inflows if approved in Q1 2026.

Challenges remain, however: SHIB's 20% year-to-date underperformance compared to Bitcoin's 150% gain highlights the riskiness of cryptocurrencies, with a correlation coefficient of 0.85 with BTC. A $2.4 million hack exposed Layer-2 security vulnerabilities, although quick patches have restored confidence.

Potential for tightening amid price declines

This reserve drop comes as memes correct 10-15% per week, with $1.1 billion liquidated across the market in 24 hours. On the plus side, it mirrors pre-pump setups - SHIB was up 300% in Q1 2025 with similar outflows - potentially targeting $0.00001 if BTC breaks above $120,000.

The selling pressure could amplify a 20-50% rally, according to the AInvest model, especially with volume signs suggesting a “bottom” at current levels. The risk? Further macro downside — a Fed rate cut delay, a weak yen — could drag SHIB down to support at $0.000014. Market sentiment X is 65% bullish, predicting a “supply shortage” but warning of “mining panic.”

Evaluation and Conclusion

SHIB's $84.7 trillion low is not a death knell - it's a energizer for the faithful. With investments accelerating and whales growing, the supply shortage could push SHIB past $0.00002 in October if ETF talks heat up. Traders: Keep an eye on $0.000018 resistance; buy orders above $0.0000165. For holders, it's confirmation - down 14.5% monthly but up 80% from the 2024 low.

Disclaimer: The information presented in this article is the author's personal opinion in the cryptocurrency field. It is not intended to be financial or investment advice. Any investment decision should be based on careful consideration of your personal portfolio and risk tolerance. The views expressed in this article do not represent the official position of the platform. We recommend that readers conduct their own research and consult with a professional before making any investment decisions.