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Shiba Inu Burn Rate Explained: Understanding Token Burning

Travis Johnson’s Bricks Burner mobile game, for example, uses the ad revenue earned to send SHIB to the dead wallet. Johnson’s SHIB Superstore has also expanded out into additional revenue streams, including food and drink, alongside additional games, to burn tokens. When Shibarium launched, users burned some 20 billion SHIB tokens using the new ShibBurn portal that was seamlessly integrated within the ShibaSwap exchange.

  1. Shibarium itself didn’t launch without hiccups, and it’s likely that the system will be fine-tuned in time.
  2. Simply put, you burn a coin or token when you remove it from circulation permanently.
  3. The process of burning tokens, however, is different and varies from one project to another, with the only common denominator being its purpose.
  4. In a bid to offload some of it and reduce the supply, the original Shiba Inu (SHIB) team sent half of it to Vitalik Buterin’s address.

Eventually, the Shib army decided to burn tokens to reach a price of $0.01. The problem here is that the total supply is too large, with too many tokens chasing too few dollars. Through community burns, and the Shiboshi name changes, the SHIB burn rate, based on March’s numbers, was around 6 billion SHIB. Here, the burn portal destroyed as much SHIB as the rest of 2022 had combined.

Shiba Inu Coin Burn: Does SHIB Burn Coins?

Admittedly, there’s a big catch with those projections. They assume that demand will remain the same as it is now and that Shiba Inu’s market cap doesn’t change along the way. That’s a highly unlikely scenario if the meme coin’s price took off in a dramatic fashion. Shibarium could present another great opportunity, in SHIBQueenie’s view. She projected that the layer-2 solution could support the burning of around 22.2 trillion tokens per year.

Can Shiba Inu burn enough coins?

Burning helps to increase scarcity, which could lead to a Shiba Inu price increase over time. Both Binance Smart Coin (BNB) and Ethereum (ETH) regularly burn coins. Luna burns and the Luna Classic burn tax are among some of the more recent burn developments. SHIB holders will have to sacrifice more tokens to achieve this goal. Moreover, it faces pressure not from more tokens being added to its already expansive base of 550 trillion tokens, but from new blockchain-based projects coming online.

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Nevertheless, this did not stop the price from surging after Vitalik wiped out nearly half the supply. This proves that the economic theory of supply and demand has merit. Holders burned 20 billion Shiba Inu on the portal within five days of its launch. The burning portal allows holders to send their SHIB tokens to a specific burn address. Simply put, you burn a coin or token when you remove it from circulation permanently.

This figure assumed a $5 billion monthly trading volume for Shibarium outside of ShibaSwap and a 1% transactional burn fee. The Shiba Inu Discord moderator known as SHIBQueenie recently detailed in a tweet just how great an impact the forthcoming burn portal might have. She especially saw the potential for ShibaSwap 2.0 to be a focal point for burning activity when the new version of the decentralized exchange launches.

And if the decrease in supply is significant, the price will move a lot higher. In addition, we will release information and broadcast of our renewed Burn Portal and how it is to operate with Shibarium in a future blog post. Get stock recommendations, portfolio guidance, and more from The Motley Fool’s premium services. What the biggest cryptos — like Bitcoin, Ethereum, and Cardano — have going for them is that they are seen as valid mediums of exchange with a store of value.

The community has long set its eyes on the coveted price target of 1 cent, but with a supply so high, it would take billions in buying pressure to achieve. The total supply of the token is reduced in the process, which carries a number of implications, both technical and economic. For example, removing tokens from the supply has the possibility to make the existing ones more valuable by making them scarcer.

🔥Introducing $SHIB Burn Mechanics to Shibarium​

Vitalik burned 90% of his SHIB holdings, accounting for more than 40% of the total supply (approximately 410 trillion coins). This means that after subtracting Buterin’s burn from the total amount of Shiba Inu destroyed, the community has burned 180 how to buy energy web token billion SHIB, worth $1.8m as of September 2022. Of course, the actual amount is higher than this, with SHIB still down from its previous 2022 highs. You may ask yourself, why should you burn your tokens instead of waiting for everyone else to do it?

While it planned to host new burn events and launch an NFT game, Bigger Entertainment has now left the Shiba Inu space. Cooper told IB Times that this came about from a call with the Shiba team that left him disappointed. Here’s just a selection of SHIB burns from the community, and how they do it. During the first half of 2022, over 70 billion SHIB was burned by the Shiba Inu community. More recently in August 2022, it burned 3.7 billion SHIB.

The first dedicated burn project in the crypto world. Shibarium itself didn’t launch without hiccups, and it’s likely that the system will be fine-tuned in time. The team is constantly outlining various priorities and is active in developing new functions. Shibarium needs to reach a certain value of #BONE accumulated. Each time this value is reached, it will be possible to burn SHIB in the Ethereum network.

SHIBQueenie’s methodology is sound, but her calculations are only hypothetical. The Shiba Inu key developer known as Archangel warned last month that a burn of 90% of SHIB tokens wasn’t on the table. Bigger Entertainment was among the first large-scale SHIB burns from the community.

There are plenty of other SHIB burning efforts going on within the Shiba community and ecosystem. The Shiba Coffee Company, for example, burns a percentage of its profits. Meanwhile, new, third-party tokens have also started burning large portions of SHIB. While Shiba Inu has no regularly scheduled SHIB burns through its tokenomics or WoofPaper, it now has the Shiba Inu burn portal that will facilitate token burns. Well, he burned 90% of it, worth around $7 billion at the time, and sent the rest to a charity related to COVID in India. While, on the surface, it might sound counterproductive, there are many reasons why you would design a protocol to burn tokens or coins.

However, the Shib community has remained consistent, averaging about 21 burns a day, at slightly over a quarter million tokens, as of March 2023. This contributes to the Shib community’s reputation of having a strong following. You will notice that the last four letters of the ciphertext end with “dEaD.” This is not a coincidence. The aforementioned null address is also a vanity address, which means that the creator specifically chose those parameters. Nevertheless, it is an homage to the fact that it is a burn address. There’s also a big question about how many tokens will actually be burned.

This is done by sending coins or tokens to an address that can receive but can not send crypto. Dead wallets are inactive for multiple years and do not send or receive transactions. The Shiba Inu burn rate is the how to properly setup your github repository windows version by alex aklson rate at which the total supply of SHIB tokens is reduced. The more you learn about crypto, the more you will realize how simple things actually are — and how we use a lot of jargon to explain multiple concepts.

This would leave you with a more valuable holding once the supply is reduced. If everyone is hodling, no one is burning, which how to buy lithium means the goal of $0.01 SHIB is further away. Instead, you would send a token to a null address if you want to burn it.