19 Oct 2021 7:31 AM +00:00

Shiba Inu Coin Burn: Does SHIB Burn Coins?

Shiba Inu Coin (SHIB) has seen a significant resurgence in the past weeks, but what is the SHIB burn rate?

Many cryptocurrencies use coin burning – the act of destroying coins by sending them to ‘dead’ wallets – to sustain themselves long-term. Both Binance Smart Coin (BNB) and Ethereum (ETH) regularly burn coins.

So, what about SHIB?

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Does SHIB Burn Coins: What Is The SHIB Burn Rate?

While a sizeable portion of SHIB has been burned in the past, there is nothing in the ‘WoofPaper’ to suggest SHIB has tokenomics setup to burn SHIB regularly. With other coins and tokens, a small amount of a transaction fee is burned, for example.

In the audit of ShibaSwap, the decentralised cryptocurrency exchange (DEX), Certik created a detailed diagram illustrating how the ecosystem works. Similarly, neither the audit nor the diagram reference any regular burning.

However, this doesn’t mean SHIB isn’t burning any tokens.

As part of the ShibaSwap’s updated listing plans, new pairs or pools added to the DEX will need to burn $25,000 in SHIB and LEASH. The ETH-RYO pool also implemented a system that burns 1% of every transaction.

The cryptocurrency also announced on October 7 that any transactions made through NowPayments will see a percentage of SHIB burned per transaction. It did not, however, disclose the percentage. NowPayments is a cryptocurrency payment service provider integrated with Shopify. It has a service fee of up to 0.5%, but we don’t know how much SHIB will burn.

Aside from this, the recently released Shiboshi NFTs have a burn mechanism. If hodlers want to name their Shiboshi NFT, they will need to burn $100 worth of SHIB. This maxes out at $1,000,000 - or 0.009% of SHIB's market cap.

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How Much SHIB Has Been Burned?

Despite these relatively low-level burns, a significant amount of SHIB is already burned, or in a dead wallet. Much of this comes from Vitalik Buterin, the creator of Ethereum.

When SHIB first launched, its team sent Buterin 50% of the total supply – around 500 trillion SHIB. Buterin burned 90% of this, or 410 trillion SHIB, stating he did not want to be “a locus of power of that kind”. The Ethereum creator donated the remaining 10% to charity.

According to CoinGecko, SHIB has a circulating supply of 497 trillion. This suggests a further 93 trillion SHIB may have been burned or is not in circulation. However, the circulating amount is likely higher. CoinGecko attributes the now-transferred SHIB held by the India Covid Relief Fund as not in circulation.

While SHIB now has some standardised burns, many holders expressed their frustration at SHIB’s burn announcements, deeming them too small. SHIB has a market cap of $11,036,760,821 at the time of writing, according to CoinMarketCap. A $25,000 burn makes up 0.00022% of the total supply.

A petition to burn a “significant amount” of SHIB has gained 9051 signatures. According to the petition creator, a larger burn would “allow Shiba to attract more investors, drive up prices through demand, and most significantly, turn Shiba into a stable crypto token and a viable payment globally.”

Read More: Shiba Inu Coin Elon Musk: Does Elon Musk Own Any SHIB?