Shiba Inu has finally rolled out a burning mechanism designed to boost the token’s price and accrue value to existing investors.
Popular blockchain project Shiba Inu has introduced a new set of burning mechanisms designed to boost the value of its ecosystem token. In a Monday update, the project’s development team announced the beginning of a new burning era tied to the layer-2 network, Shibarium.
Shibarium, like other layer-2 networks, enables users to transfer value and interact with decentralized applications (dApps). However, Shibarium’s roadmap includes a provision that allows the rate of transactions on the network to impact the burning of SHIB tokens.
Put simply, the more transactions on Shibarium, the more SHIB burned and vice versa. The network would allocate 70% of the base fee to burning SHIB, with another 30% dedicated to ongoing maintenance.
Per the roadmap, the fees are collected in the network’s native gas fee token, Shibaswap (BONE), and converted to SHIB for burning once it reaches a threshold of $25,000 in USD value.
SHIB Burns Finally Live on Shibarium
Following Shibarium’s launch in August, many in the SHIB community expected the burn program to roll out as soon as possible. However, that wait lasted four months, with the protocol unable to accumulate the required $25K in BONE until now.
Commenting on the new burn mechanism, the Shiba Inu team labeled it as a “transformative” move that strategically removes tokens from circulation. It would also potentially boost the token’s value and benefit the Shibarium ecosystem.
In the first-ever Shibarium-linked burn, Shiba Inu developers burned 8.2 billion SHIB (worth around $76,000) on Tuesday. The team will continue to burn tokens manually using its deployer wallet, reflecting user activity on Shibarium.
Meanwhile, the long-term vision is to introduce an automated burn mechanism in January. The team reckons the automated model will follow predetermined rules and deliver other benefits, such as transparency and efficiency.
Shibarium’s Increased Adoption Bodes Well For SHIB Burns
The first-ever Shibarium-linked burn and the introduction of a comprehensive burning model came at a time when the layer-2 network was seeing increased adoption.
As The Crypto Basic recently reported, Shibarium processed over 20 million transactions in the space of three days, surpassing figures recorded in the first few weeks of the network’s existence.
Such an increase in transaction activity accelerates the burn program. Other factors, such as a rapid rise in gas fees on Shibarium, would also lead to more SHIB burns.
Overall, the Shiba Inu team assures that the future of token burns on the network “looks promising.” SHIB enthusiasts hope that the latest efforts to reduce the token’s bloated supply will yield excellent results and enable the cryptocurrency to eliminate more zeros in the upcoming bull market.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
