The Shiba Inu co-founder Shytoshi Kusama has appraised that the team has been working hard for the mainnet launch of the Layer-2 scalability platform Shibarium. As per the tentative plans, the Shibarium mainnet launch shall happen at Blockchain Futurist Conference in August next month.
The team at Shiba Inu has also been focusing on other areas such as improving the SHIB burn rate, and how the launch of Shibarium will aid this further. Also, the team has shown its dedication by implementing the Shiba Inu Burn program.
The rate of Shiba Inu (SHIB) burn has been fluctuating, with some days showing notable increases while others showing declines. However, the recent burn rate has not been particularly remarkable. LUCIE, the top team member behind building the Shibarium tech recently shared how the launch of Shibarium can affect the SHIB burn rate.
$SHIB BURNS X #Shibarium, #Shibarium significantly impacts the Shib eco by introducing a burning mechanism that reduces the supply of $SHIB . When users make transactions on the network, the base fee is locked on a Shibarium contract, while the priority fee is paid to… pic.twitter.com/uhqvwDWgdW
— 𝐋𝐔𝐂𝐈𝐄 (@LucieSHIB) June 30, 2023
Lucie proposes a new kind of burning mechanism through Shibarium that will reduce the supply of SHIB. The Shiba eco official proposes that when users make transactions on the Shiba Inu network, the base fee gets locked in the Shibarium contract while the priority fee gets paid to the validators. Later, the base fee gets divided of which 70% is burned and the rest 30% is set aside for network maintenance.
Lucie states that it’s important to understand the difference between the base fee and the priority fee. The base fee represents the minimum amount needed for a transaction to be considered valid. This fee is burned, meaning it is permanently removed from the supply of SHIB tokens, reducing their overall availability. In contrast, the priority fee is an additional amount paid to validators as an incentive for including transactions in blocks. This encourages validators to prioritize transactions with higher fees, ensuring faster processing times.
Lucie further explains that when users accumulate $BONE tokens in the burn contract, it triggers the burning process on Ethereum’s L1 network. These $BONE tokens are exchanged for SHIB tokens, which are then burned, reducing the overall supply.
Users can start the burning process by visiting Shibarium’s website and confirming the transactions to migrate to the Layer 1 network. Once the process is finished, the SHIB tokens are permanently removed from circulation, affecting the maximum supply of SHIB.
This burning mechanism will bring along several key benefits. The first is introducing deflationary aspects to SHIB tokens and reducing their supply over time. Thus, it will potentially benefit token holders via increased value and scarcity. The second benefit is that the burn mechanism will help maintain the supply-demand balance within the Shiba Inu eco. Thus with fewer tokens in circulation, and assuming that the demand remains constant or increases, it will lead to a potential SHIB price appreciation.
The burning mechanism encourages users to get involved and engage with the platform. By accumulating BONE tokens and initiating burns, users actively participate in reducing the supply of SHIB tokens. Shibarium provides a user-friendly portal that simplifies this process, making it accessible to everyone. Users can simply click on “Initiate burn” and confirm their transactions to contribute to the permanent removal of SHIB tokens from circulation.
