Shibarium, the Layer-2 blockchain frequently mentioned in recent times, has recently experienced a significant increase in Total Value Locked (TVL). For the first time since September, the eagerly anticipated Shibarium surpassed the $1 million level. This level coincides with a significant increase in the burn rate of SHIB tokens that occurred last week.
Value on the Rise in Shibarium
After Shibarium’s TVL rose above $1 million and continued to climb, it experienced an 8.98% decrease within 24 hours, falling back to $1.03 million. The peak level mentioned was the $1.13 million high point reached on December 23rd.
On-chain data provided by DeFilLama reveals that a large portion of the total value locked on the Shibarium network is transferred from decentralized exchanges. MARSWAP and ChewySwap contribute approximately $820,000 to the total TVL of Shibarium.
Furthermore, there has been an increase in transactions throughout December on the Layer-2 blockchain. The average daily transaction count on the network was calculated at 7 million, and the total number of transactions jumped from 2.2 million blocks to 177 million. These figures demonstrate the growth and adoption of Shibarium since its issues were carefully addressed following its launch in August.
The Future of Shiba Inu (SHIB)
Even more notable is the expansion in the Shiba Inu ecosystem coinciding with a significant increase in SHIB’s burn rate. Over the last 7 days, a staggering 97% increase in the token’s burn rate resulted in more than 17 billion SHIB tokens being removed from circulation.
The total SHIB tokens burned have surpassed 410 trillion, indicating nearly half of Shiba Inu’s total supply. The token burning process typically aims to reduce a coin’s circulating supply. A reduction in supply can trigger an increase in demand, potentially leading to a price increase if demand rises.
As a result of the reduction in the total number of tokens in circulation, there has also been a significant decrease in the number of SHIBs available on exchanges. On-chain data indicates that since November, over 8 trillion SHIB worth $88 million have been transferred out of crypto exchanges where SHIB transactions can be conducted. Such withdrawals from exchanges are interpreted as a bullish sign in the market and reflect investors’ commitment to not selling their tokens.
Despite the high burn rates and withdrawals from exchanges, SHIB’s price only increased by 33% over the past month, which seems modest compared to the performance of altcoins that accompanied Bitcoin‘s incredible surge. For a simple comparison, it can be said that Solana-based Bonk Coin increased by 373% during the same period.
Nevertheless, noted analyst Ali Martinez points out that as long as Shiba Inu remains above the support level of $0.0000103, the next target could be $0.0000140.
