In a recent tweet that caught the attention of the Shiba Inu community, Shibburn, a Shiba Inu burn tracker known for automating transactions, shed light on the crucial relationship between token burns and their influence on Shiba Inu’s price movement. Addressing a common question often encountered, Shibburn tackled the puzzling query: “Why isn’t the price moving after ‘massive’ burns?”
Shibburn emphasized that token burns, even in massive quantities, do not possess the sole power to drive significant price movements. The burn tracker elucidated that burning as much as 10 billion tokens weekly would not create substantial price impacts when far larger token transfers occur regularly, keeping prices relatively stable.
It stressed that token burns should not be viewed in isolation to comprehend the dynamics of price movement. The value of a token hinges on the fundamental principles of supply and demand. Even if a token burns a significant portion of its supply, its price ultimately depends on the extent of demand in the market.
Shibburn Assures Shiba Inu Price Surge Despite Token Supply Concentration
Regarding the distribution of Shiba Inu tokens, Shibburn pointed out that a large portion of the token’s supply, approximately 400 trillion, rests in the hands of the top 100 accounts, mainly centralized exchanges. Despite this supply concentration, Shibburn reassured that the price can still surge based on increased demand, especially in bullish market conditions. As more individuals continue to buy, exchanges may raise their purchases, thus increasing Shiba Inu’s price.
Shibburn aimed to dispel the misconception that a token’s success solely hinges on achieving a specific price target, such as $0.01. The burn tracker elucidated that different investors have diverse price goals, and some may have already taken profits when the token reached their target price. Instead of fixating on a singular price target, Shibburn urged the community to focus on adoption, project development, and active participation in initiatives contributing to the token’s overall growth.
Shibburn challenged those dismissing token burns’ significance without grasping their underlying implications. To clarify the essence of token burning, employed an analogy, comparing it to a scenario where a whale buys many tokens but never sells them.
The burn tracker asked readers to envision token burning as if a massive whale were attempting to accumulate a substantial portion of the token’s supply yet committing to never selling. These tokens remain locked indefinitely, creating a scarcity that can undeniably impact the token’s value.
Shibarium’s Potential Impact
Looking to the future, alluded to the anticipation among Shiba Inu enthusiasts that at least five trillion SHIB tokens could be burned monthly once Shibarium, a significant development in the Shiba Inu ecosystem, goes live.
As the Shiba Inu community continues to navigate the intricacies of token burns and price movements, Shibburn’s insights offer valuable context and understanding, contributing to a more informed and enlightened discourse within the community.
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