Shiba Inu, one of the most popular meme tokens on the market, experienced a significant drop in burn rate. The sharp drop in Shiba Inu burnt supply should be viewed negatively, especially amid a bleeding cryptocurrency market. However, there is a workaround.
Shiba Inu’s burning process works differently than Ethereum’s. SHIB has three distinct addresses to which users send money to withdraw tokens from circulation rather than automatically burning a portion of the network’s transaction fee.
Notably, funds are simply sent to wallets that no one can ever access; technically, the network lacks a burning mechanism. It is, however, sufficient to slow the asset’s inflation. Individuals or businesses who promise to burn a certain number of tokens fuel significant increases in burning volume. The low burning volume suggests businesses are either experiencing a drop in Shiba Inu revenue or no extra tokens to burn.
How Could Things Change?
The only way to increase the burning volume is for businesses that pledged to use the Shiba Inu tokens they received as part of the proceeds from selling goods and services to increase their revenue. Some users may use SHIB as a payment method, increasing the network’s available volume for burning.
Small batches of tokens to burn need more value to affect SHIB’s pricing. Shiba Inu has had one of its worst two months since October when it lost more than 40% of its value. Fortunately, the resurgence of burning could refocus investors’ attention on the well-known joke token.