This Is Why Shiba Inu Witnessed a 6,000% Surge in SHIB Burn Rate

10 months ago 5

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Shiba Inu’s SHIB burn rate witnessed a noteworthy surge of nearly 6,000% during the past week, marked by the incineration of approximately 9.4 billion tokens.

This heightened burning activity occurs amid a discernible reduction in transaction volume on Shibarium, the layer 2 network of the meme coin.

SHIB Burn Rate Spikes 6,000%

Over the past week, Shiba Inu has witnessed an impressive 5,972.36% uptick in its burn rate, removing over 9.4 billion tokens from circulation. The burn rate represents over 10% of the total number of SHIB tokens destroyed last year.

Token burns typically aim to reduce the circulating supply of a coin. A decrease in supply can theoretically lead to scarcity, potentially driving up prices if demand remains high.

The notable surge in SHIB’s market value this week can be attributed to its elevated burn rate. This increase coincided with a resurgence across the broader market, spurred by the approval of several spot Bitcoin ETFs in the US.

These events resulted in SHIB’s price rising by around 5% during the past week to a high of $0.0000105.

Shibarium Transactions Decline

Concurrently, the Shibarium network has endured a noticeable decline in daily transactions over the past month. Daily transactions have dwindled from an average of 7 million in December 2023 to less than 2 million this month.

Indeed, daily transactions dropped from 7.84 million on December 28, 2023, to 1.16 million as of January 13, 2024.

Still, other network metrics reflect the substantial growth and adoption Shibarium has enjoyed since its launch. The layer 2 blockchain now boasts 1.3 million wallets and has generated 2.64 million blocks. Additionally, the total value of assets (TVL) locked on Shibarium peaked at around $1 million earlier this month.