Shiba Inu (SHIB) faces a critical juncture as analysts warn of a potential 10% correction, signaling a deepening identity crisis for the once-viral memecoin. The token's founding team has largely abandoned development, leaving no clear roadmap after multiple failed ecosystem projects failed to sustain its legendary 85,000,000% 2020-2021 rally. With dwindling community momentum and negative sentiment prevailing, SHIB's era of chaotic growth appears definitively over as it struggles to transition from speculative asset to functional cryptocurrency.

Shiba Inu: Why the Case For a Collapse Is Growing

The most hyped launch of them all is the Shibarium layer-2 solution, which was released in August 2023. The launch itself was delayed by over two years, but still, traders were hopeful that a mechanism to burn SHIB tokens had finally arrived. While the initial days saw Shibarium brimming with activity, it quickly turned into disappointment.

Shibarium was marketed as a ‘SHIB burning mill’ that will send trillions of tokens to the dead wallet. This, in turn, will scale up its price in the charts due to token scarcity. None of that turned reality, as the burns were meager, some even coming to as little as $20 per day. For instance, in May 2025, Shibarium finally burned a total of 1 billion tokens. However, the burns were worth only $15,000.

That is not a significant amount that can change Shiba Inu’s prospects in the charts. 1 billion tokens is a small number compared to its 549 trillion tokens in circulation. Until Shibarium kicks-start bigger burns, Shiba Inu’s case will always be bearish, despite the marketing gimmicks. If the burns decline, a recovery for Shiba Inu will look impossible, but a collapse is inevitable. Traders want utilities now and no longer fall for the hype and buzz.