Popular blockchain project Shiba Inu has revealed a new era of token burns for its Ethereum-based layer 2 blockchain solution, Shibarium.
Shiba Inu Unveils Latest Burning Mechanism
On Monday, December 4, Shiba Inu announced a fresh set of burning techniques to increase the ecosystem token’s value. According to the announcement, the team described the new mechanism as a “transformative” move, crucial for the network’s economic model.
The purpose of this technique is to intentionally reduce the token supply in order to increase the value of SHIB and its ecosystem. The announcement read:
Shibarium is introducing a transformative token burning mechanism, crucial for the network’s economic model. This mechanism is designed to reduce token supply strategically, potentially increasing the token’s value and benefiting its ecosystem.
The burn mechanism has been divided into two distinct phases. These include the Manual phase and the Automated Transition phase.
The Manual phase will see the token burn managed by the official deployer wallet. This makes it possible to observe and adjust closely to ensure alignment with the network’s sustainability and health.
Several changes will be made during the Automated Transition phase to improve dependability and efficiency. According to the Shiba Inu team, the previous mechanism will transit into an automated system.
The burn process for this phase will function according to predetermined guidelines, making it more transparent and efficient. However, this automated aspect is expected to begin in January next year.
So far, the first-ever token burn performed by the Shiba Inu team saw about 8.2 billion SHIB tokens burned, valued at approximately $76,000. The team will keep burning tokens manually using its deployer wallet to represent user engagement on Shibarium.
Shiba Inu’s latest Shibarium burn mechanism underscores a “major milestone” for the network’s development, according to the official blog post. Shibarium is establishing a standard in blockchain token economics by coordinating token burning with network utilization and constantly improving the procedure through updates.
Shibarium’s Transactions Increases Significantly
Lately, Shibarium has seen a surge in transactions and a sharp increase in gas fees by up to 1,000%. Due to this, the token burning has increased exponentially. This is because an increase in the network’s usage leads to more tokens getting burned.
Shibarium has grown purposefully to surpass its best since its introduction in early August. Several weeks ago, there were only a few thousand transactions each day, but today, there are on average 7 million.
According to data from Shibarium Explorer, that number is currently at 7.82 million. The total number of transactions has also increased lately, totaling 36,730,230 as of the time of writing.
Featured image by iStock, chart by Tradingview.com
