Developers of the popular meme coin, Shiba Inu, have created a portal where investors can burn their $SHIB holding to reduce the amount of the token in circulation.
This move is designed to help the token grow in value by promoting scarcity. Usually, developers embrace a burning mechanism as a means of reducing the number of tokens in circulation to create a level of scarcity which helps to push the price of the asset higher.
Popular digital assets like Ethereum and Binance’s BNB have popularized this burn mechanism to make the tokens deflationary and also ensure their scarcity in the market.
For context, to burn a token means removing them from circulation. To do this, such tokens are sent to a burn address, otherwise known as a dead wallet. These are wallets with no obtainable keys, whose contents are irretrievable; hence anything sent to it is gone forever, and out of circulation.
By adopting this mechanism, Shiba Inu developers hope that this burning will help put the token on the list of best digital assets.
Interestingly, the Shib team stated that “any project can use the Shiba Burn Smart Contract in order to create a “BURN Pool” and to offer rewards for burning $SHIBtokens.“
Burning Shiba Inu would earn holders rewards
To encourage the burning, $SHIB burners can earn passive income in the form of RHYOSHI rewards. According to the site, investors who burn their $SHIB tokens would share 0.49% of all RHYOSHI transactions.
A statement from the website reads
This portal has been built to reward $SHIB burners, with a passive income acknowledgement, in the form of $RYOSHI Rewards.
Data from the burn website disclosed that about 410 trillion units of Shiba Inu have been burnt since the token’s ICO. As of press time, the growth rate of the burn mechanism is pegged at 13.51% in 24 hours.