TL;DR
- Shiba Inu’s circulating supply was reduced last year due to the billions of burned tokens.
- SHIB’s price is up 115% on a yearly scale, thanks to numerous potential factors, such as the burning mechanism, Shibarium’s progress, and others.
The Burning Goes on
The popular meme coin initially had a total supply of a whopping one quadrillion tokens. At launch, 50% of the amount was locked into the decentralized exchange Uniswap to provide liquidity, while the remaining half was sent to Ethereum’s co-founder Vitalik Buterin.
The computer programmer later donated trillions of SHIB to the India COVID-Crypto Relief Fund and other charity organizations. Eventually, he burned the remaining 410 trillion SHIB tokens, worth approximately $6.7 billion at the time.
Buterin’s initiative was followed by an imminent price rally for the dog-themed meme coin. After all, fundamental principles of economy dictate that reducing the circulating supply combined with non-declining demand should be followed by a pump.
In 2022, the Shiba Inu team officially adopted a burning mechanism that enables the community to send tokens to a dead wallet voluntarily. According to a recent post, over 44.6 billion SHIB, worth a little more than $1 million, were destroyed throughout 2024.
While the USD equivalent of the stash might not sound that impressive (considering the fact that it stretches over the span of 12 months), continuous efforts in that field will make the meme coin more scarce and potentially more valuable.
Meanwhile, the burn rate has jumped roughly 100% in the past 24 hours, resulting in nearly 1.9 million SHIB sent to a null address.
SHIB Price Outlook
Reducing the circulating supply of the meme coin throughout 2024 could be one reason why its price has charted a solid increase of 115% between January 1 last year and the beginning of 2025.
Other factors include the booming cryptocurrency market, more particularly the meme coin niche, and the further advancement of Shibarium.
The layer-2 scaling solution, which aims to foster the development of the Shiba Inu ecosystem, blasted through numerous milestones last year. Around Christmas, the total transactions processed on the protocol exceeded 700 million, while prior to that, wallet addresses crossed 2 million.
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