After last week’s report by Shiba Inu Coin lead developer Shytoshi Kusama that the supply burn is low-priority, investors are starting to worry. During the summer of 2022, we saw a high supply burn rate. This includes July, August, and September. There were days that broke records when it came to supply burn. An example of this would be the 100 million SHIB token burn during the second week of September.
By mid-September, we saw more than a 135% increase in supply burn when compared to August. Many Shiba Inu reaffirmed their position with the token and began accumulating supply because of the increasing burn rate. What those same investors were not expecting was that despite the supply burn being a “low-priority”, on the 11th of October, Shibburn reported 135 million tokens burned in a single transaction.
There were many other transactions that were significant, although they got overshadowed by this big transaction.
On the 14th of October, there were 2 transactions that burned a total of 60 million tokens, which is worth around $600. Although that is not much, these transactions happened in a short period of time and are accumulating.
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Since Shiba Inu Coin has a non-growing total supply, this ensures that in the future, there will be significantly fewer tokens than what we have now. This ensures scarcity, which was the developers’ plan from the beginning since they want to secure Shiba Inu’s future in the crypto space. Of course, that future still depends on the way investors view the network and the incentives the network trigger in users.
TL;DR: A lot of SHIB tokens got burned during mid-year; the supply burn rate is going down.
Another Shiba Inu (SHIB) Crash Incoming?
Following the 15th of October, the daily supply burn reduced significantly, falling by 5% in just a day as of the 18th of October. The 17th of October also saw the supply rate reduced by another 10%.
This can start yet another bearish phase for Shiba Inu. The reason why this might be such a problem is the psychological barrier around Shiba Inu (SHIB). As of the 18th of October, the price of Shiba Inu (SHIB) is around $0.000010. If it falls below that, it will add another comma, which might trigger further issues.
The last time Shiba Inu fell below the $0.000010 mark was back in June when it instantly lost another 20% in price evaluation due to the aforementioned psychological barrier. Keep that in mind, as we are currently tippy-toeing around the threshold.
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TL;DR: If SHIB drops below $0.000010 we will probably experience yet another 10%-20% drop in evaluation.
Why Is The Shiba Inu Supply Burn Important?
Nowadays, it seems like everyone is talking about methods to burn Shiba Inus wherever you turn. They are aware that the currency has lost value as a result of the first 1 quadrillion coins in circulation. The only way to restore supply and demand to equilibrium is to burn.
The reasoning is straightforward – Shiba Inu burn quite a lot of tokens before it gains significant value. It’s difficult for me to perceive every new initiative the Shiba Inu community does as a cunning technique to burn tokens and remove them from circulation. Perhaps we are being overly pessimistic about its future.
TL;DR: The more SHIB is burned, the more SHIB will gain value (price evaluation).
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