CoinGeek reports:
The nearly perfect correlation between two tokens suggests potential convergence. FLOKI’s supply on exchanges reaching 5 billion indicates a possible nullification of the 5% growth.
According to IntoTheBlock data, Floki [Floki] exhibits a stronger correlation with Shiba Inu [SHIB] than with any other cryptocurrency. As of the time of writing, the 30-day correlation matrix between these two meme coins stands at 0.96.
Correlation matrices range from -1 to +1, focusing on cryptocurrencies’ correlations with other high-market-value currencies. Values close to -1 indicate minimal price movements in the same direction.
However, when readings approach +1, it signifies that cryptocurrencies move almost identically most of the time. This is the case with FLOKI and SHIB.
At the time of writing, FLOKI is priced at $0.00014. This figure represents a 5.84% increase over the past 24 hours. Conversely, SHIB is trading at $0.000015, with a much higher increase of 15.22%.
Based on their correlation, if Shiba Inu’s price continues to rise, FLOKI may potentially mirror its performance. However, failure to do so could lead to a decline in the token’s value.
Examining other aspects of their respective ecosystems, tokens seem unable to sustain price hikes. One major reason for this is active addresses.
Can FLOKI’s price continue to rise?
Active addresses denote the number of users actively engaging in transactions within a given period. As of the time of writing, FLOKI has seen a decline to 432 active addresses over 24 hours.
SHIB has dropped to 3511. A decrease in this metric indicates low interaction with the token. Should this occur, it also suggests declining demand for the token.
Another consideration by AMBCrypto is how the rate of price increase outpaces network activity. When participation is low and token prices rise, there’s a risk of their value subsequently falling.
If this trend persists, FLOKI and SHIB might struggle to keep up with the upward trend. Exchange supplies also confirm this forecast.
Exchange supply measures the number of tokens sent from external sources to exchange wallets. An increase in this metric indicates holders are willing to sell some tokens.
However, when token holders prefer to retire tokens and hold them privately rather than keep them on exchanges, this figure declines.
As of the time of writing, FLOKI’s exchange supply stands at 5 billion, marking a significant increase compared to July 5.
Reality or not, here’s the market value of FLOKI’s SHIB:
From a price perspective, this could disadvantage meme coins as increased sales volume may depress token values.
If this continues, FLOKI’s price could drop to $0.00012. Given its strong correlation with SHIB, a similar trajectory is possible for it too.
