Shibarium is set to welcome a burn portal to bolster the new SHIB token burning mechanism.
Alongside the burning, there’s a growing clamor for utility and adoption of Shibarium.
Since the launch of Shiba Inu’s Layer-2 scaling protocol Shibarium, one of the most talked-about projects has been the new burn mechanism for Shiba Inu (SHIB) coming on the protocol. Despite the broad-based interest, the exact date for the launch of the new burns mechanism is yet to be disclosed.
Before now, SHIB had a burn mechanism which was introduced last year but the team is looking to come up with a more efficient one. There are speculations that this upcoming burn mechanism will help offset trillions of SHIB every month.
One Shiba Inu influencer known as Queenie hypothesized that the new burn mechanism could burn as much as 111 trillion tokens every year. If her hypothesis is true and SHIB is able to burn up to 100 trillion tokens, it might impact positively on the price of the memecoin in the near future. With the optimism soaring, it is, however, worth noting that token burn potential alone is not enough to trigger an increase in token price.
Shiba Inu would be required to also experience a spike in demand in addition to the burn rate for a potential price jump. Looking at these factors, it is difficult to predict how soon or long it would take for the project to reach $0.01 if 100 trillion tokens are burned to effect a downward slide in circulating tokens. Owing to the current supply of Shiba Inu, if the project can burn 100 trillion tokens every year, it will take 5 years to bring the supply down to 80 trillion.
For the supply to come down to billions, it would take up to six or seven years. Not until this time can the token begin to realistically reach a price of $0.01 without the market capitalization becoming unrealistically large. Importantly, it should be understood that it is not yet certain whether bringing the supply down or not would push the price to $0.01 as broader market sentiment and other factors are still poised to play crucial roles.
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The launch of Shibarium is believed to have the capacity to bring onboard more real-world use cases for Shiba Inu. This could in turn, increase the demand and then trigger an asset price jump.
The Failed Launch of Shibarium
Unfortunately, the first launch of Shibarium did not go as planned as the protocol encountered some difficulties during its debut. The Ethereum-based L2 scaling solution met with unforeseen explosion of simultaneous transactions and user influx which led to a technical hiccup. Shytoshi Kusama, Shiba Inu’s lead developer, tried to allay the fears of users who became agitated that their funds were lost.
His assurance did not do much to boost the confidence of the community as SHIB soon started to lose its market value. It became evident that the SHIBArmy were faced with Fear, Doubt and Uncertainty (FUD). In the long run, Shibarium was made to go private so as to get the team to fix the several technical mishaps on the protocol. Since its return, users have remained cautious about utilising the protocol.
At the time of this writing, Shiba Inu is trading at $0.000007568, down by 1.86% in the last 24 hours per data from Market Cap and the token is now on many watchlists to explore its performance in the mid-to-long term.
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