The Shiba Inu ecosystem is set to experience a significant transformation by implementing an automated Shibarium burn system starting January 2024. This development, initially detailed in a December 2023 blog post by the Shiba Inu team, marks a shift from the manual burning process that began on December 4, 2023. The manual phase saw the team successfully send 8.24 billion SHIB tokens to a dead wallet, with 33.8 billion SHIB burned in four transactions over 18 days.
This transition to automation represents a strategic move to enhance the burn mechanism’s efficiency. The automated system is structured to function based on specific, predefined rules, aligning with the ecosystem’s goal of significantly reducing the SHIB token’s circulating supply.
Details of the automated burning process
The automated burn mechanism is intricately designed, leveraging the Shibarium network’s gas fees. A noteworthy aspect of this process is allocating 70% of the network’s base fee to purchase and burn SHIB tokens. Bone ShibaSwap (BONE), the designated gas fee for the network, will be converted to SHIB before being sent to a dead wallet.
The trigger for this automated process is set at a $25,000 threshold in BONE. Upon reaching this value, the system will initiate the conversion of BONE to SHIB and proceed with the burning. This mechanism contrasts with the manual phase, where larger amounts of SHIB were burned per transaction due to the $25K threshold being exceeded before each burn.
The new automated system aims to facilitate more frequent burns, albeit with smaller quantities of SHIB per transaction. The quantity of SHIB burned in each transaction will depend on the token’s prevailing market price.
Impact on the Shiba Inu ecosystem
The implementation of this automated burn system is anticipated to have a profound impact on the Shiba Inu ecosystem. With over 410.69 trillion SHIB tokens already burned, the Shibarium-powered burns are expected to reduce the token’s hefty circulating supply further. This reduction is essential to the ecosystem’s broader strategy and will likely influence the token’s market dynamics.
The shift to an automated system aligns with the team’s commitment to creating a more efficient and sustainable ecosystem. Shibarium aims to enhance transparency and predictability in its operations by reducing manual intervention and relying on a rule-based system.
The Shiba Inu ecosystem is poised for a significant phase of evolution with the commencement of automated SHIB burns in Shibarium. This move reflects the team’s strategic planning and commitment to enhancing the token’s value and stability within the cryptocurrency market. As the ecosystem continues to evolve, the impact of these developments on the market and the community will be closely monitored.
