Shiba Inu Layer 2 network Shibarium, which is built atop the Ethereum blockchain, was launched a few months ago to much anticipation. However, there have been a lot of fluctuations in the performance of the Layer 2 network which could have an adverse effect on the SHIB price.
New Blocks Created Crashes
The number of blocks created on a network usually reflects how much the network is being used. If activity rises, so will the number of blocks being created. Now, if the activity on the blockchain drops, then it is selected in a drop in the number of new blocks, which is a problem the Shibarium network has run into.
According to data from ShibariumScan, the number of new blocks created on the network is down over 38% in just two days. Block creation had been steady for the better part of October, leading into November where it peaked on November 7. On this day, a total number of 17,212 blocks were created on the network.
However, in the days following this, the number of new blocks created has dropped steadily. On November 8, the total number of new blocks in Shibarium was 12,655, and then on November 9, there was a further drop to 10,627, culminating in a 38.25% drop so far.
At the same time, however, the average block size on the network has been on a steady increase, going from 934 bytes to 1,340 bytes. Although this is a long way from its October peak of 2,820, it is still a notable increase.
The drop in block production could be explained by the drop in new and active accounts. Both metrics have fallen in the last 3 days, with only 20 new accounts created and 588 active accounts on November 9.
SHIB price holds $0.0000081 | Source: SHIBUSD on Tradingview.com
Effect On Shiba Inu Price
The Shiba Inu price has been on a downtrend over the last day but this decline is not necessarily linked to the decline in new Shibarium blocks. Bitcoin lost its footing above $37,000 and this decline in the apex cryptocurrency has spilled onto other assets in the space.
Shiba Inu has actually seen its trading volume increase in the last day by over 40%. Now, while this could signal that there is profit-taking in the coin, which is expected, it also shows there is still a lot of interest in the meme coin.
Presently, SHIB is trading at $ 0.00000815 with the bulls still firmly in control of the price action. A bounce back in the Bitcoin price will likely see the asset continue to trend upward going into the weekend.