Why Shiba Inu Price Can’t Reach $0.001

Why Shiba Inu Price Can't Reach $0.001

The Reality Behind Shiba Inu’s Journey to $0.001

Introduction

In the last crypto bull market that spanned from 2020 to 2021, there was immense excitement and speculation surrounding Shiba Inu, a meme coin inspired by the popular dog breed. With its price soaring as high as $0.00008, many enthusiasts began dreaming of a target price of $0.001. However, as time has passed, it has become evident that achieving this goal is as unrealistic today as it was back then. In order to explore the reasons behind this, we need to examine the burn mechanism of SHIB tokens, the role played by Ethereum founder Vitalik Buterin, and the challenges of burning a significant portion of the token supply.

Insufficient Token Burning

The Shiba Inu community initiated its burning initiative in 2022, whereby SHIB tokens are sent to dead addresses on a weekly basis. Despite having more than a year to implement this process, the total number of SHIB tokens burned so far has been relatively insignificant when considering the vast scale of the total token supply. According to the data provided by Shibburn, a Shiba Inu burn tracking website, approximately 410,658,326,324,061 tokens have been burned since the inception of the burn strategy. This accounts for just over 46% of the maximum total supply of more than 999 trillion tokens. However, it is worth noting that the community burn makes up less than 1% of the total figure.

The majority of the tokens burned thus far can be attributed to Ethereum founder Vitalik Buterin. The Shiba Inu founders had initially sent half of the token’s supply to Buterin, who subsequently donated 50 billion SHIB to an Indian COVID relief fund and burned the remaining tokens by sending them to a burn address. Buterin’s transaction alone accounted for approximately 410 trillion tokens, marking the first significant burn event for SHIB. Comparatively, the community burn that occurred over the past year only makes up approximately 0.15% of the total burned tokens.

The Stumbling Block towards $0.001

The primary objective of the Shiba Inu community burn was to rapidly reduce the supply of SHIB tokens. However, the supply remains significantly high, acting as a hindrance to achieving higher prices when compared to its main competitor, Dogecoin. The community burn initiative is not removing tokens from circulation at the pace necessary to facilitate SHIB’s ascent to $0.001. Realistically, for SHIB to reach such a price point, at least 80% of its supply would need to be burned. This would entail removing hundreds of trillions of tokens from circulation, mirroring Buterin’s burn process.

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However, this ambitious goal faces insurmountable challenges. Most of the remaining SHIB tokens are already in circulation, held by millions of investors. Burning a large portion of these holdings is highly unlikely since investors would be reluctant to destroy a significant portion of their assets. It is akin to throwing dollar bills into an open flame. Unfortunately, this means that the price of the meme coin is unlikely to reach $0.001, especially considering its current circulating supply, which is over 579 trillion tokens, even exceeding the portion of the supply already burned.

Conclusion

The journey of Shiba Inu toward the coveted $0.001 target remains fraught with challenges. While the community burn initiative was intended to reduce the token supply, the progress has been considerably limited. The majority of tokens burned thus far were a result of a significant burn event carried out by Ethereum founder Vitalik Buterin. The sheer quantity of SHIB tokens in circulation and the reluctance of investors to burn their holdings make it highly improbable for SHIB to attain such lofty levels. As the cryptocurrency market evolves, it is crucial to understand the realities and limitations of meme coins like Shiba Inu, tempering expectations with a pragmatic perspective.

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