Shiba Inu’s exchange reserve has hit a new all-time low, a sign that market participants continue pulling their tokens from exchanges. Despite experiencing significant losses over the past three months, with the token down nearly 63% since December 2024, the decreasing exchange reserve reflects growing confidence in Shiba Inu’s potential recovery.

Shiba Inu Exchange Reserve Hits an All-Time Low

According to CryptoQuant, Shiba Inu’s exchange reserve dropped to 93.573 trillion tokens on March 16, representing just 15.88% of the asset’s circulating supply. This marks a new all-time low, underscoring a broader trend of investors withdrawing tokens from exchanges. Although this figure might not account for all exchange wallets, it still provides valuable insight into the current market behavior.

The drop in the exchange reserve has been a persistent trend in recent months. In early January, a large routine movement from Crypto.com contributed to a 33 trillion SHIB decline in the reserve, but since then, the trend has been largely driven by investor withdrawals. Market analyst Ali Martinez confirmed a notable withdrawal of 1.67 trillion SHIB from exchanges within just 24 hours last November, further emphasizing this trend.

Why Investors Are Pulling Tokens from Exchanges

Withdrawals from exchanges typically indicate that investors are looking to hold onto their tokens for the long term, rather than trading them on the market. This trend is particularly noteworthy given the current market conditions, where Shiba Inu has faced significant losses. According to IntoTheBlock data, the number of long-term holders (those holding SHIB for at least a year) has surged to a peak of 1.09 million addresses, the highest for any tier. This growing trend of long-term holding suggests that investors are still confident in Shiba Inu’s long-term potential, even in the face of current market turbulence.

How This Could Benefit Shiba Inu’s Price Recovery

The withdrawal of Shiba Inu tokens from exchanges can be bullish for the asset, especially during recovery periods. As more tokens are taken off exchanges, sell pressure decreases, reducing the available supply in the market. This tightening of liquidity can help shift market sentiment and potentially boost the price. Reduced supply on exchanges often leads to higher demand, supporting the token’s price recovery.

Shiba Inu is already showing signs of recovery, having secured three consecutive daily gains since March 14. The token hit a low of $0.00001201 on that day but has since rebounded by 10%, currently trading at $0.00001322. If the token can break through the next resistance level at $0.00001380, it could signal a shift from bearish to bullish momentum.

The Potential for Shiba Inu’s Price to Rebound

Shiba Inu’s recovery is still in its early stages, but the growing trend of long-term holders and decreasing exchange reserves could provide the necessary support for further gains. The token is eyeing the pivot level at $0.00001493, which could mark the next major resistance point. If SHIB continues to show signs of strength and successfully breaks this resistance, the momentum could shift, sparking a more substantial price recovery.

In conclusion, the drop in Shiba Inu’s exchange reserve to an all-time low of 93T SHIB signals growing confidence among investors. With fewer tokens available for sale on exchanges, Shiba Inu may be able to reduce sell pressure, tighten liquidity, and position itself for a potential rebound in price. While the market remains volatile, these indicators suggest that SHIB could experience a recovery in the near future.