The team behind one of the most popular doge-inspired memecoins – Shiba Inu (SHIB) – has launched a burning mechanism that allows holders to burn their tokens while also generating passive income.
The SHIB Burning Portal
The Shiba Inu burning portal is a functionality that enables users to send their SHIB tokens to a burn address. This is a wallet from which SHIB will no longer be retrievable, meaning that once the tokens are sent there, they can never be retrieved again – they’re going to be gone forever.
This effectively introduces a mechanism that allows for a reduction of the total circulating supply, making the tokens scarcer.
This, in theory, can benefit investors – a scarce asset tends to be more preferred compared to one with unlimited supply or with considerable rates of inflation. Of course, all of this is entirely theoretical, and there’s nothing guaranteed – fixed or reducing supply doesn’t necessarily translate to increased value, meaning that the outcome of the burning portal is yet to be seen.
The Incentives Behind the Portal
The team’s reasoning behind the portal has been partially incentivized by the strong community’s push in this direction.
The Shiba Inu Community, or as commonly known and nicknamed “The Shib Army,” has been quite vocal and providing ongoing feedback that would relate to creating a systematic method in which scarcity can increase, while pushing the potential to grow the communities wealth in their investment.” – Reads the official website.
To reward users who decide to burn their tokens, the team provides an incentive in the form of a potential passive income source. Those who burn SHIB will receive a token called burntSHIB. The owners of the latter will receive rewards in RYOSHI tokens. (RYOSHI is the anonymous creator of the Shiba Inu project). 0.49% of all RYOSHI transactions will be distributed to the owners of burntSHIB tokens.
To verify and double-check the details of the Shiba Inu burn mechanisms, anyone can check the smart contract here.