Shiba Inu exchange reserve has again hit a new all-time low, as market participants continue to pull their tokens from exchanges.
This bullish development comes despite the persistent market turbulence, with SHIB witnessing some of the most brutal losses among major altcoins. For context, Shiba Inu has witnessed consecutive declines over the past three months, down nearly 63% since December 2024.
However, it appears market participants remain confident in Shiba Inu’s potential recovery, as observed by its exchange reserve metric. This indicator tracks the amount of Shiba Inu held by wallets belonging to major exchanges such as Binance, Robinhood, Crypto.com, Coinbase, and others.
Shiba Inu Exchange Reserve Falls to ATL
According to CryptoQuant, the Shiba Inu exchange reserve reached a new all-time low of 93.573 trillion tokens on March 16, representing just 15.88% of the asset’s circulating supply.
It bears mentioning that this indicator often bypasses some exchange wallets that are not properly identified, suggesting the actual exchange reserve could be higher. However, the recent downward trend in this metric reflects market realities despite a potential discrepancy in actual figures.
For context, the downward trend observed with this indicator has persisted throughout this year, according to CryptoQuant data. Amid the downtrend, the metric picked up a massive 33 trillion SHIB decline in early January but this was due to a large routine in-house movement from exchange Crypto.com.
However, the broader crash has genuinely been a result of exchange withdrawals. Last November, market analyst Ali Martinez confirmed that investors withdrew 1.67 trillion SHIB from exchanges within 24 hours.
1.67 trillion $SHIB have been withdrawn from exchanges in the past 24 hours. The last time we saw a similar spike, #ShibaInu surged 62% in price. pic.twitter.com/zcgmusDCuP
— Ali (@ali_charts) November 20, 2024
Notably, market participants typically pull out their tokens from exchanges when they plan to HODL them for a longer time. According to IntoTheBlock data, long-term Shiba Inu holders (holding for at least a year) have surged to a peak of 1.09 million addresses, the highest for any tier.
How This Could Help SHIB Price Recovery
This growing trend could be extremely bullish for the asset, especially during recovery. When investors withdraw tokens despite a downturn, it reduces sell pressure, signals confidence, and limits exchange supply. This can tighten liquidity and potentially shift market sentiment, helping the token recover faster.
Interestingly, Shiba Inu is already on a mild recovery path, having secured three consecutive daily gains since Friday, March 14, when it hit the $0.00001201 support. SHIB has rebounded 10% since then, as it currently changes hands at $0.00001322.
The meme coin currently eyes the Pivot level at $0.00001493, which, if breached, could flip momentum from bearish to bullish in the short term. However, Shiba Inu must first break above the stubborn resistance around the $0.00001380 mark. If the exchange withdrawals help mitigate selling pressure, a breakout could materialize.
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