What happened
The cryptocurrency market is seeing recent losses extend into another day of trading, but Shiba Inu (CRYPTO:SHIB) is gaining ground. The popular meme token’s price was up roughly 1% over the previous 24-hour period as of 6 p.m. ET Thursday.
Investors have generally been moving out of speculative, high-risk investments amid mounting valuation concerns and macroeconomic risks, but there’s recently been some movement back into select cryptocurrencies. Despite recent confirmation that the Federal Reserve is looking to significantly increase interest rates this year, Shiba Inu’s token is moving higher after recent pullbacks.
Image source: Getty Images.
So what
After big sell-offs, the Shiba Inu digital coin is now down roughly 75.5% from the lifetime high it hit late in October, and bullish investors are cautiously nibbling at the token after a recent valuation slide. On the other hand, the token is still up more than 15,370,000% over the last year of trading even after the big pullbacks.
Now what
Shiba Inu currently has a market capitalization of roughly $11.7 billion and ranks as the 14th largest cryptocurrency by valuation. In addition to meme trading momentum and the potential for a bullish uptick in the broader crypto market, there are also upcoming metaverse projects built around the Shiba Inu token that could help to spur demand and adoption for the cryptocurrency and help push its valuation higher. But investors should keep in mind that SHIB has already posted unprecedented gains over the last year of trading, and there’s a high risk that the token will continue to slide.
Cryptocurrencies and stocks are generally facing bearish pressures after Federal Reserve Chairman Jerome Powell confirmed Wednesday that the U.S. central bank will soon increase interest rates and still sees room for significant increases down the line. Speculative investments tend to thrive in environments where interest rates and bond yield are low because investment capital is easier to secure and returns on low-risk income generators is minimal. But it looks like the macroeconomic backdrop is shifting.
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