Shibarium is a layer 2 chain built on top of Ethereum. The idea is to turn Shiba Inu, the well-known meme coin, into a standalone ecosystem. It should become a competitor for L2’s like optimism and Arbitrum. The chain is community run and has a unique token burning mechanism.
So, let’s have a look at what Shibarium is all about.
What Is Shibarium?
As already mentioned, Shibarium is a new layer 2 solution on Ethereum. However, it is still in the Beta phase at the time of writing this article. The anonymous creator of Shiba Inu, Ryoshi, came up with the idea. From his perspective, a community needs a low-cost blockchain. This made Shibarium a prime goal.
🚨Hi #SHIBARMY! We are happy to announce that Shibarium's Testnet is running again. You can now access the Docs to learn how to set up your equipment & understand how Shibarium works. You will find the Docs here: https://t.co/1FDQOnd9Gu 🦴
— Shib (@Shibtoken) March 24, 2023
Shytoshi Kusama, wants to offer low-cost transaction to the Shib community. He is the Shiba Project Lead. The community had to deal with typical Ethereum issues. For example, Shiboshi NFTs faced high ETH gas fees. In a nutshell, that’s how we landed at the Shibarium layer 2 solution. Here are a few features of this new layer 2, for example:
- The platform will have a simple SHIB burning mechanism.
- There will be a network bridge between Ethereum and Shibarium.
- It is a Proof of Stake (PoS) chain.
It has its own token, BONE. You can use this, currently, as a governance token for ShibaSwap. This is a DEX. However, it will also be the Shibarium token that allows you to pay for gas fees.
The platform already has a few projects running in its young ecosystem. For example, Atomic Wallet already supports the network. Here are some more projects, for instance:
- Shib – Its a metaverse.
- Shiba Eternity – A mobile only card battle game.
- Shibarium DAO – The first DAO on the Shibarium network. It already has its own ecosystem, with six Dapps. The picture below shows the Shibarium Dao landing page.
Source: Shibarium DAO
What Will Shibarium Do for Shiba Inu?
Shibarium has big plans for Shiba Inu. From only being a meme coin, it aims to transform it into a complete ecosystem. Many crypto experts don’t see a future for SHIB. That’s despite holding rank #16 in market cap of all crypto coins. With Shibarium at work, things may change around.
The main feature will be that you can trade SHIB on the platform. However, this may take some time. Building a new blockchain takes time. But, once it’s up and running, it may benefit SHIB. It may not only offer another use case, but also cause a price increase.
There’s also the case of the SHIB burn mechanism. This may also be a positive factor for SHIB’s price development. Scarcity tends to do that. It makes things rare. As a general rule, you can say, the rarer something becomes, the more expensive it becomes.
Another positive result may be greater adoption of SHIB. It will become cheaper and faster to use SHIB. In short, it will be a lot easier to use SHIB. So, in general, it’s quite possible that we see an uptrend in SHIB. But it won’t be overnight, it will take time. Remember, Shibarium is in its testnet phase. The picture below is the Shiba Inu website, announcing the testnet.
Will Shibarium Burn Shiba Inu?
Shibarium has a burn mechanism in place for Shiba Inu. All gas fees are in BONE. From all the collected gas fees, The protocol will burn 70%. The remaining 30% is for network maintenance.
The protocol needs to collect $25,000 worth of BONE in the dedicated burn contract. Upon reaching this number, users can start the burn process. The Shibarium website has a specific portal for this.
The protocol sends the accumulated BONE over to Ethereum. Here it’s swapped for SHIB. The smart contract will now burn this SHIB. It works exactly like a withdrawal. However, nobody receives the tokens, the smart contract burns them instead.
Anyone can start this process by clicking on the ‘Initiate burn’ button. However, you need to complete a few transactions that are part of this process. After all, the tokens move from a layer 2 to a layer 1. At the end of this process, the burned SHIB is no longer part of the circulating supply. This is immediately reflected on the total max supply.
Attention #SHIBARMY 🚨
We're thrilled to announce that #SHIBARIUM Public Beta will be launching THIS WEEK! 🎉
Make sure you’re following our official socials over the next few days as we reveal all the details on how to access the beta website. Hail Shib! #ShibariumBeta pic.twitter.com/z7wuKLpcFU
— Shibarium Technology (@Shibariumtech) March 7, 2023
This is Part 1 of our beginner’s guide to Shibarium. We answered three popular questions about this protocol. For example, what is it, will it burn Shiba Inu, and what will it do for SHIB? You can read part 2 here.
At the time of writing this article, the current price of BONE is $0.7998. It has a $183.7 million market cap. The max supply is 250 million tokens. The total and circulating supply sits at 230 million tokens.
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