Cryptocurrency tracker Coinbase shows that Shiba Inu coin has gained 30.32%, with a price increase of 21.43% in the last 24 hours.
At the time of writing, the price has reached an all-time high of £0.000021 per SHIB.
The move is representative of a wider shift in the market, as Bitcoin and ether regained a few percentage points.
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Bitcoin currently sits at £31,644.62, which will be comforting to investors who have watched the coin plummet since its high of £51,000.00 in November 2021.
Meanwhile, Ether has gained almost 20% in the last week, too. Its current value is £2,280.04, which is almost a 100% increase over the last year.
SHIB's gain has also triggered other memecoins to follow suit, including Dogecoin, which inspired the former. Doge has only climbed just over 6%, but still sits far ahead of Shib in terms of value.
Why is Shiba Inu gaining value?
As a whole, the market has seen a 25% recovery since January 24, 2022. This has largely been led by alt coins (alternative coins, i.e. any other than Bitcoin), which could mean that investors have a rising appetite for risky coins.
This rally following a dip is normal, and often driven by investors. They buy the coins while the value is low, which helps drive the value up again. It's so common that it is called 'buy the dip' among investors.
FundStrat told CoinDesk: "Much of the momentum is likely due to $160 million of combined short liquidations for BTC and ETH over the past 24 hours".
This meant 'an exchange forcefully closed a trader’s leveraged position due to a partial or total loss of the trader’s initial margin.'
A leveraged position refers to when an investor has more in borrowed funds than what they could actually afford, bumping their trading position up. It is banned in the UK.
The gains are also likely to be connected to wider economic movements in the US, as the Federal Reserve put a pause on raising interest rates which previously caused alarm. Also, there's a wider rally in stocks, such as with the tech stock Nasdaq and Amazon.
This shows how Bitcoin is becoming more of a mainstream asset, as investors react to it based on what is happening elsewhere. As Bitcoin is still the dominant cryptocurrency, its movements are largely mirrored by the altcoins.
They can sometimes move independently, however. This may continue to happen more often as some riskier investors switch their attention to smaller coins.
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