u.today
What is happening?
This past week has not been good for the Shiba Inu coin. The overall decline in valuation has reached 12.12%. The dog-themed meme coin could not break through major resistance on its way to late September’s peak of $0.000021.
On Friday, the Wall Street Journal published a report, stating that the U.S. federal government is reportedly investigating Tether, issuer of the stablecoin USDT, for potential violations of anti-money laundering and sanctions laws.
As the newspaper claims, Federal investigators, led by the U.S. Attorney's Office in Manhattan, are examining whether third parties have used Tether to fund illicit activities, although no official charges have been filed.
Tether CEO Paolo Ardoino denied any ongoing investigation, stating on X that there is no evidence to suggest Tether is under scrutiny.
In official response, Tether called the article “irresponsible reporting,” asserting that it contains “reckless allegations” without verified sources.
Following this report, Bitcoin's price fell from $68,600 to $66,589, and Tether briefly dipped to 99.81 cents as the broader crypto market reacted to the news.
After the news of the supposed Tether investigation broke, SHIB declined around 4.16%.
Shibarium spike
On Wednesday, Shibarium, the Layer-2 blockchain for Shiba Inu, saw a dramatic 1,557% increase in active accounts, according to Shibariumscan data.
Active accounts soared from 1,685 to 26,237 in a single day, primarily due to previously inactive accounts becoming active, with only 3,814 new addresses joining.
This sudden rise in activity also boosted daily transactions on Shibarium, which spiked by nearly 1,380%, jumping from 128,047 to 1.76 million transactions.
This surge marked the highest daily transaction volume on the Shiba Inu blockchain since March, highlighting renewed activity on the network dedicated to the popular meme cryptocurrency.
Will meme coins recover?
While Shiba Inu is currently trading at $0.00001692, it is still exhibiting a consistent upward trend and might be gaining from the same volume increase observed on other meme coins.
Shiba Inu is still approaching a potential "golden cross," a technical indicator often associated with significant price increases. In recent weeks, SHIB has gained momentum, with its 50-day EMA nearing a crossover with the 200-day EMA, a key element of this bullish signal.
If the 50-day EMA moves above the 200-day EMA, it could attract new buying interest and bolster SHIB’s price.
While a golden cross does not guarantee a rally, it is generally seen as a sign of potential growth, especially if supported by increased trading volume and stronger market sentiment. SHIB has shown resilience, bouncing off key support levels and steadily regaining strength.
The question remains whether the crypto market in general survives the current negative news on Tether. If the Wall Street Journal publication proves to be wrong, the October rally has a chance to continue into November.