- SHIB has an oversupply problem of 589 trillion tokens in circulation
- A large price drop may happen, especially with the false 28,850% burn rate
- Shiba Inu updates could stay on hold due to a divisive community
The Shiba Inu (SHIB) community has been in shambles lately after a switch in leadership from the founder Ryoshi to the newly-appointed Shytoshi. Not only did it cause a stir within the SHIB army, but it has also made the general crypto community wonder: is Shiba Inu doing alright?
Recently, the burn rate of SHIB dropped by 63.85%, where 10,247,830 tokens were migrated to hard-locked wallets where the credits cannot be spent. According to the rate tracker website Shibburn, the weakest burn rate happened on Sunday, January 28. However, a day before that, it was found that the burn rate was at a massive 28,385% – the highest percentage since the third quarter of 2022.
The 28K rate was allegedly wrong because it was not entirely from the burn. Instead, around 28,485,400 tokens were migrated to “inferno” wallets. More questionable was that not even one million tokens were burned during that time. When the community discovered that the percentage was based on the transfer of more than 28 million tokens and not as a massive reduction in supply, many short-term traders backed out of the cryptocurrency.
SHIB Supply Currently Bloated
As of writing, SHIB has more than 589 trillion tokens in circulation. As for the total supply, it is at a countdown of almost reaching one quadrillion. Upon checking the subreddit of r/Cryptocurrency, the crypto community has been whispering about an impending meltdown as the supply keeps growing.
To add fuel to the fire (and, unfortunately, not for the burning of tokens), the SHIB army has its battle: themselves.
Before the burn, Ryoshi handed down his leadership role to Shytoshi. However, numerous community members called out on the new leader for allegedly “overthrowing” the SHIB founder. Discord moderators refused to see him as a respected leader, not giving him access as an admin to the community. As a response, Shytoshi created his own new SHIB army group via Telegram.
That said, the moderators then accused Shytoshi of firing members, to which he responded that they left on their own.
Returning to the main topic, SHIB is now at a supply problem with no massive burns to “normalize” the number of tokens. If it continues to increase without more of the community’s efforts, the price will drop beyond anyone’s expectations.
However, this would also mean that short-term holders will be filtered out, leaving only dedicated long-term investors to keep the cryptocurrency growing.
The meme token is currently at a standstill despite its new announcement of the much-anticipated Layer 2 solution, Shibarium. SHIB developers have said that the beta testing for the feature will be released within this year, although some are hoping that the L2 network could help in more organic burns in the future.
