- Shibburn has flagged a massive burn of 20MShiba SHIB, slashing the circulating supply in one move.
- Can this burning mechanism truly drive sustainable upward momentum?
On-chain data tracker Shibburn has reported a massive 20,000,000 Shiba Inu [SHIB] burn transaction, significantly reducing the circulating supply of the token.
An anonymous whale executed a burn as part of today’s 20.79 million SHIB burn, increasing the daily burn rate by 34.24%.
Token burning is vital to SHIB’s tokenomics, aiming to create deflationary pressure and potentially boost its value over time.
However, despite these burns, SHIB’s price remains volatile, currently down 60% from its post-election high of $0.00003340.
Source: TradingView (SHIB/USDT)
The effectiveness of its deflationary strategy is up for debate.
While routine burns reduce the circulating supply by locking tokens in dead wallets, SHIB still faces the challenge of its enormous circulating supply – 589.25 trillion tokens.
Take the 23rd of February, for example, when 40.45 million SHIB tokens were burned. Yet, just a day later, SHIB posted an 11% dip, mirroring Bitcoin’s[BTC] 4.5% drop.
Source: Shiba Burn Tracker
Shiba Inu: Will this burn drive long-term value?
SHIB’s price is influenced more by social media hype, investor behavior, and market conditions than just its circulating supply.
Currently, SHIB’s Social Volume has hit a three-month low, mirroring its price decline. This drop in engagement often signals a decline in market interest, making it harder for SHIB to rally without fresh attention.
Even more concerning is the trading volume – once surging past $4 billion during election “hype”, it’s now fallen to just $311.44 million.
Source: Santiment
This sharp reduction in volume indicates a lack of market participation. If social momentum and buying pressure don’t pick up soon, SHIB could remain trapped in its current bearish trend.
