The popular meme coin Shiba Inu (SHIB) coin has seen its burn rate plummet to zero over the past 24 hours. Burning tokens refers to the process of permanently removing them from circulation. This is often done to reduce the overall supply of a cryptocurrency, potentially increasing its value over time.
Shiba Inu Burn Rate Plummeted by 100%
According to Shibburn, a website that tracks SHIB token burns, the burn rate for Shiba Inu has declined by 100%.
Source: X
This means that in the last 24 hours, no SHIB tokens have been burned at all. In fact, the last recorded burn was on August 13, when 802,246 SHIB tokens were removed from circulation.
This sudden drop in burn rate isn’t just a one-day anomaly. Over the past week, Shiba Inu’s burn rate has decreased by more than 62%, with only about 42.9 million SHIB tokens burned. This trend is concerning for investors who were hoping to see a reduction in the overall supply of SHIB tokens.
Shibarium’s Automated Burn Mechanism Fails to Deliver Expected Impact
Recently, Shiba Inu introduced Shibarium, a layer-2 network designed to improve transaction speeds and reduce fees. Part of Shibarium’s appeal was its automated burn mechanism, which was supposed to convert 70% of transaction fees into SHIB tokens and then burn them.
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However, this new system hasn’t had the positive impact many were expecting. There simply haven’t been enough transactions on Shibarium to generate significant fees for burning. Daily transactions on the network have been hovering between 3,000 and 8,000, far below the millions seen in late 2023. This is a far cry from the peak of about 5 million daily transactions recorded in December 2023. The highest daily transaction count in recent weeks was a mere 8,630, observed on August 1.
Economic Indicators Show Trouble for SHIB
It’s not just the burn rate that’s causing concern. Other economic indicators for Shiba Inu are also showing signs of trouble. Large transactions are down by over 14%, suggesting that big investors (often called “whales”) are losing interest.
SHIB large transaction are down by 14%. Source: Santiment
Furthermore, only 45% of Shiba Inu holders are currently in profit, with the majority holding their tokens at a loss. The network is also struggling to attract new investors, as evidenced by declining net network growth.
At the time of reporting, Shiba Inu coin is trading at approximately $0.00001328, down almost 1.2% in the last 24 hours.
SHIB/USD Daily Price Chart. Source: CoinMarketCap
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