Liquidations and Shiba Inu burn rate surge reshape leverage risk in volatile market

Recent volatility in the crypto market has underscored how quickly sentiment can shift for Shiba Inu, even when technical signals briefly turn positive.

Shiba Inu rebound fizzles as leverage unwinds

Shiba Inu enjoyed a short-lived bounce after four consecutive days of losses, giving traders a momentary sense of relief. The meme coin climbed 4% to reach $0.0000080 and briefly touched $0.000008133 before momentum stalled. However, a renewed bearish turn across the wider crypto market quickly erased those gains, forcing leveraged traders to reassess their exposure.

As prices reversed, market participants sharply increased their focus on liquidations data. Long positions took the heaviest hit, underlining the risks associated with aggressive leverage in such a volatile environment. Moreover, the pullback arrived just as sentiment had started to improve, catching many bullish traders off guard.

The situation was captured succinctly in a post from TheCryptoBasic, which highlighted that 6,202,753,441 SHIB long positions had been wiped out while the burn metric soared 859%. That combination of forced selling and on-chain burning has become a defining feature of recent trading sessions, amplifying both upside and downside moves.

Massive long liquidations hammer SHIB traders

Traders who had positioned for rising prices using leverage suffered outsized losses as the market turned. According to CoinGlass, roughly $41,000 in long positions were liquidated over the last 12 hours, while 24-hour liquidations climbed to about $58,000. Longs accounted for $49,560, or 85.44% of total liquidations, with shorts making up just $8,440.

At the prevailing price of $0.000007990, the long-side wipeout equals around 6.2 billion SHIB. In contrast, short liquidations total roughly 1.05 billion SHIB. That said, the recent pullback still left the token up 0.97% over 24 hours, underscoring how even modest price changes can cascade into large forced selling for overleveraged traders.

From last week’s low of $0.000007581, the coin has gained 5.39%, showing that price has not broken down decisively despite the turbulence. However, analytics indicate that if the market retests $0.000007580, around $754,630 in additional long positions could be liquidated, equivalent to nearly 99.55 billion SHIB. Such a move would likely deepen short-term pressure on bullish speculators.

Conversely, an upside push toward $0.00000840 may trigger approximately $661,630 in short liquidations, or about 78.76 billion SHIB. This asymmetry illustrates how current positioning leaves both sides vulnerable, with modest moves in either direction capable of unleashing another wave of forced trades and adding to overall shib market volatility analysis.

Burn rate spike adds another layer of volatility

Alongside the liquidation wave, the shiba inu burn rate has emerged as a key metric for on-chain watchers. Over the past 24 hours, the burn rate jumped 859%, according to tracking data, although the absolute amount destroyed remained modest. In total, only 12.91 million SHIB were removed from circulation during this period.

The single largest burn came from CEX.io, which sent 9.5 million SHIB to the official burn address. Moreover, other notable contributions included transactions of 1.78 million, 1.52 million, and 1.27 million tokens. These flows show a mix of community-driven activity and exchange initiatives, signaling ongoing efforts to reduce supply gradually.

So far, the ecosystem has destroyed roughly 410.753 trillion SHIB, leaving about 589.24 trillion tokens still in circulation. However, even relatively small daily burns can influence sentiment, particularly when they coincide with sharp moves in derivatives markets. Traders frequently track shiba inu exchange burns as part of their broader on-chain analysis.

The interplay between leverage and supply reduction has become increasingly important for those following shiba inu coins. When liquidations spike at the same time as burn activity, order books can thin out quickly, and price swings may intensify. That said, the long-term impact of these burns remains subject to overall demand, macro conditions, and the behavior of major holders.

Leverage, community activity, and price outlook

The surge in long-side liquidations underscores the structural risks faced by traders using margin on meme assets. In this episode, long positions dominated the wipeouts, with shib long positions liquidated far outpacing shorts in both token and dollar terms. Moreover, the outsized share of longs in overall liquidations highlights how quickly optimism can reverse when broader crypto sentiment sours again.

At the same time, the community continues to engage through burning initiatives, exchange-led reductions, and active monitoring of key wallet flows. While some investors focus on on-chain scarcity signals, others remain more concerned with short-term shiba inu price action around levels like $0.000007580 and $0.00000840. Both perspectives influence liquidity conditions and can shape how quickly prices respond to new inflows or outflows.

Looking ahead, investors may watch closely for further burn events or renewed bursts of volatility around major support and resistance zones. The recent combination of 6.2 billion long positions liquidated and a steep burn rate increase shows how exposed both long and short traders remain when using leverage. However, strategic risk management and careful position sizing can help mitigate shib liquidation risks leveraged during such rapid market swings.

Overall, shiba inu’s latest episode of heavy liquidations and a sharp burn rate spike highlights the complex dynamics now driving this meme asset. As derivatives positioning, community burns, and exchange actions intersect, even modest price moves can translate into outsized consequences for traders on both sides of the market.