Amount of burned tokens on rise, but at the same time, it might not be enough
Even though Shiba Inu ended last year with extremely low network activity, just as any other blockchain out there, the burn rate of the meme currency dropped to an extreme 25 million SHIB per day. Luckily, we are seeing a recovery tendency.
According to Shibburn, in the last 24 hours, more than 90 million Shiba Inu tokens have been burned by various addresses, which corresponds to a 35% rise. With the recovering activity of the cryptocurrency market, we should see a gradual increase in the number of destroyed tokens.
Thirteen hours ago, an anonymous address burned 76 million SHIB tokens, making it the biggest burned amount of meme assets in the last 24 hours. Unfortunately, for the burning operation to have a noteworthy effect on the market, Shiba Inu investors should burn around one billion tokens.
The lack of burning volume is explained by the close to nonexistent utilization of the Shiba Inu network. Merchants that accept SHIB tend to burn significant amounts when they manage to gain a decent trading volume, which does not happen often, considering the decreasing popularity of the meme coin and crypto payments in general.
However, the lack of traction on the market we are seeing today is temporary, and Shiba Inu’s burning volume may recover, with the general return of inflows to the industry and the popularization of cryptocurrencies as payment methods.
For example, Shiba Inu’s trading volume has stayed at approximately $32 billion while the token traded at the ATH. Throughout 2022, it descended to only $5 billion, which explains the drastically decreased burning volume. The correlation between the two metrics is obvious.