Disclaimer: The following content does not constitute the opinion of BeInCrypto and should not be construed as financial advice.
Shiba Inu, a prominent Ethereum-based altcoin, has garnered attention in the crypto market with its recent surge in token-burning activities. In just one day, the Shiba Inu community burned an impressive 46.14 million SHIB tokens, contributing to the larger initiative that has already seen over 410 trillion SHIB tokens incinerated from the initial supply.
Purpose of Token Burning: Creating Scarcity for Increased Value
The primary goal behind burning Shiba Inu tokens is to induce scarcity, thereby elevating the value of the remaining tokens. This strategy aims to counteract potential inflationary effects linked to increased token minting or distribution. Recent market trends suggest that this approach aligns with the broader sentiment.
Concurrent with the burning activities, Shiba Inu’s price experienced a notable surge. Over the past 24 hours, the SHIB price rose by 8.55%, reaching $0.000009052, with a substantial weekly surge of 15.12%. This surge in value was accompanied by a 23% rise in trading volume, reaching 347 million. The correlation between token burning and the price surge underscores the impact of scarcity on market perception and value.
Shibarium’s Influence and Shiba Inu’s Resilience
Shibarium, the Shiba Inu Layer 2 network, has witnessed a reduction in activity, with a 38% decrease in the number of blocks created. Despite this, SHIB’s price remains resilient and continues to attract attention from crypto enthusiasts, highlighting the token’s adaptability in the volatile crypto market.
Setting a Precedent for Memecoins
Shiba Inu’s substantial token burn and the resulting price rally could set a precedent for other memecoins. This action may inspire similar strategies across the memecoin ecosystem, leading to potential implications:
- Imitation Strategy: Other memecoin developers might replicate Shiba Inu’s token-burning strategy to create scarcity and drive up token value.
- Investor Perception: Investors witnessing Shiba Inu’s success may shift their attention to other memecoins employing similar strategies, potentially leading to increased trading volumes and higher prices.
- Market Sentiment: The success of Shiba Inu could positively influence overall market sentiment towards memecoins, attracting more investors to this niche market.
In the wake of Shiba Inu’s burn strategy, Meme Moguls (MGLS) presents a unique proposition in the meme-based digital asset space. Unlike typical memecoins, Meme Moguls is developing the world’s first meme-backed stock market/exchange. This innovative platform could draw in a new segment of investors interested in meme culture and digital asset trading.
The project is currently in its beta presale stage at $0.0019, offering an incentive where Meme Moguls will reward one lucky user with a $10,000 prize at the end of each presale phase. Investors are advised to conduct thorough research before engaging in any cryptocurrency investments.
