All Shiba Inu fans make some noise because the most anticipated project of Shiba Inu, Shibarium, is finally about to come.
But to rightly welcome this high-potential upgrade, we must understand it first. After all, not only will it impact Shiba but also its competitor coins and projects.
So, let's get into the reading mood for the next 5 minutes and comprehend this Shibarium to understand how it will benefit Shiba.
What is a Shibarium?
Shibarium is a Layer-2 solution for Shiba that mainly aims to reduce the time and fee involved in the transactions taking place in the ecosystem of Shiba Inu.
Currently, the Shiba Inu ecosystem uses the Ethereum blockchain to process all its transactions. The Layer solution “Shibarium” will take a load of most Shiba-related token transactions from the Ethereum blockchain. It will use the underlying security of Ethereum but will process the transactions in itself. These transactions will occur outside the main (Ethereum) blockchain and then will update back in the Ethereum blockchain. This approach will allow the L2 blockchain (Shibarium) to do the majority of work for transactions to reduce the fees and time for the end users.
Along with these benefits, Shibarium will also expand the functionality of the Shiba ecosystem. It will allow the creation of chain-specific NFTs and Metaverse that will include event tickets, game assets, digital art, and real estate ownership in the virtual form.
But this is not it.
The Shibarium network will also integrate a burn portal that will continually keep removing SHIB tokens from circulation. It plans to do so by charging a nominal transaction gas fee on all transactions for which the user will require to 'Burn' their SHIB tokens and reduce their supply. Shiba developers have yet to announce the total SHIB tokens that will burn in this portal. However, the Shiba community expects this burning to be a significant catalyst in boosting the price of the SHIB token soon.
How will Shibarium work?
The system of Shibarium will run around three primary tokens- SHIB, LEASH, and BONE. All these three tokens will play significant roles in the smooth functioning of the DPoS (Delegated Proof of Stake) consensus of Shibarium.
BONE will act as the platform token of the Shibarium protocol. The network will collect the transaction fees and distribute rewards to its nodes in the BONE token. It has a total supply of 250 million, of which 20 million will be reserved for the Validators and Delegators of the platform. The validators are the network nodes that verify and validate the transactions. In exchange for their service, the validators receive rewards according to their staked tokens. If an individual wants to support the network, he can become the delegator. These delegators willingly delegate their voting rights and tokens to the validators in a DPoS system. The validators then use their combined voting rights and resources to validate transactions and secure the network.
Anyone willing to become a validator needs to own $BONE that they will lend to their chosen validator nodes. Suppose their selected validator node successfully validates the transactions. In that case, the delegators get a portion of the reward the validators earn. These rewards will include a portion of the transaction fee and some high-utility tokens of the network. The delegators can lose their landed tokens if the validator fails to follow the protocols. There can be only 100 validators in the Shibarium as per its latest plan. Each validator needs to stake a minimum of 10,000 BONE tokens.
Another popular token of Shiberium, SHIB, will play an important part in all the transactions taking place on Shibarium. It is because each transaction on Shibarium will contribute to the burning of SHIB tokens. The network will use the collected base gas fee from transactions to burn SHIB tokens. First, the network will charge a minimal gas fee on transactions in the BONE token to compensate for the computational power and efforts of network validators. Then a specific amount of this gas fee will be used to burn SHIB tokens of equivalent value.
The third token of the Shibarium ecosystem is LEASH. According to the official website of Shiba, LEASH will help to maintain liquidity on the Shiba platforms and stabilize other currencies of the Shibarium. A holder of LEASH tokens can stake them to become part of a liquidity pool. All participants of this pool earn a portion of newly added BONE tokens in the blockchain according to their LEASH contribution in the pool. The developers of Shibarium are planning to add new use cases for the LEASH token in the upcoming upgrades.
How can Shibarium impact the price of SHIB?
Since the launch of Shibarium will bring the burn portal for SHIB tokens, it will surely affect the circulation supply of SHIB tokens. We discussed above that each transaction happens on the Shibarium. Users will need to burn a fixed amount of SHIB tokens. This continual burning of SHIB will pave the way for removing SHIB tokens from the market. Through it, the scarcity of SHIB might enter the market, which will cause the price of SHIB to touch new highs. Apart from that, the Shibarium will increase the robustness and security of the Shiba projects. It will also contribute to boosting the price of SHIB.
According to some experts, the Shibarium launch will cause SHIB's price to touch the $0.01 mark in the coming months. Moreover, with the other projects of Shiba Inu, like Metaverse, DeFi, and NFTs, some experts also expressed the possibility of SHIB reaching a worth of $10 by 2024.
However, the Shiba platform has not yet revealed the scale of SHIB burning that Shibarium will bring. Thus, the actual effect of Shibarium on SHIB is hard to guess for now. For burning to create an impactful price change for SHIB, it has to burn trillions of tokens.
If it happens and SHIB breaks the record by touching a cent price point, it will be a dream come true for the SHIB holders.
What is the launch date of Shibarium?
Initially, Shibarium was about to launch in the third quarter of 2022. However, it did not happen. There have been certain rumours that the beta launch of Shibarium will occur next week, but no official announcement is made yet.
Though on February 26, 2023, the lead developer of Shiba, Shytoshi Kusama, launched a ‘Join’ portal for those interested in contributing to the Shibarium. This portal invites Web3 developers, entrepreneurs, investors, and content creators to join Shibarium and contribute to its testing and final documentation. If the testing goes as planned, the Shiba community expects the main net launch of the Shibarium blockchain by the last quarter of this year.
Closing Thoughts
Shibarium is back again in the news, creating a lot of excitement for the SHIB holders. This upgrade will be a turning point for the future of Shiba Inu, and hence you must be aware of all its possibilities. The details of the Shibarium are looking pretty exciting and worth the wait. If things go as planned, SHIB will likely make new records.
