Sharpedo do not actually explode when they stop moving, as anyone who trains them can attest; indeed, they do not even explode when everyone from Voltorb to Snorlax in turn tries to teach them how to do so. Yet as many sailors past and present attest, Sharpedo do in fact explode when (and only when) they collide with ships at sea. This does not happen in every collision, however; at times, a ship's hull is run through by Sharpedo teeth and it soon sinks, but the Sharpedo swims away unharmed.
Many theories have been advanced as to how this happens, and it was once widely thought to be a chemical reaction, but the change from wooden to metal ships caused no change in the number of exploding Sharpedo and science is no closer to solving this mystery than ever, in large part because of the few domestic Sharpedo available for study. The biting of ships is better understood; it is a strange sort of self-defense, a method to avoid exploding, although how it works is still unexplained.
Whatever the reason, it has made water travel across the open sea extremely hazardous for much of history, ending the lives of many explorers prematurely and making live pokemon the preferred method of water travel across the world. Although the risk has been dramatically reduced in recent decades, ever since people began to place Dive Balls around the hulls of ships, most people remain too frightened to ride a boat through any sea, for there are very few bodies of water in the whole world where Sharpedo have never been sighted.