On the same day Shiba Inu founder Shytoshi Kusama tweeted (December 29) about Shibarium, ETH whales accumulated SHIB, and putting the crypto in the top 10 ranking of the most held token among 2,000 whales in the last 24 hours.
The launch of Shibarium, the upcoming L2 scaling solution for the Shiba Inu ecosystem, has been teased by Kusama, and many are wondering what this could bring on the table for SHIB in terms of price improvement.
Image: Watcher Guru
ETH Whales: Shibarium And What It Means For SHIB
The L2 upgrade has been in development for some time already as the community-run ecosystem distances itself from its memecoin origins. The close implementation of Shibarium brings the SHIB community closer to this goal.
— Shytoshi Kusama™ (@ShytoshiKusama) December 29, 2022
The main gist of Shibarium is to provide the Shiba Inu community a robust ecosystem for them to participate in. It promises utility, better throughput, and metaverse developments, not to mention games. Being deflationary, the burning of the token is a crucial part of Shibarium’s well-being.
In the past 24 hours, there have been a total of 182,339,090 $SHIB tokens burned and 11 transactions. Visit https://t.co/t0eRMnyZel to view the overall total of #SHIB tokens burned, circulating supply, and more. #shibarmy
— Shibburn (@shibburn) January 3, 2023
But even though ETH whales have accumulated SHIB ahead of Shibarium’s launch, the token has not experienced any meaningful gains in the past 24 hours. It even slipped by 0.7% compared to BONE, the governance token of the upcoming Shibarium upgrade, which pumped over 5.6% since yesterday.
What Can Happen On Shibarium Launch Day
As launch day nears, SHIB might lag behind BONE in terms of short-term price growth. This is because BONE is Shibarium’s governance token, giving its holders rights to vote on where the ecosystem should go.
Long-term, however, the role of ETH whales and the burning of SHIB might have a significant effect on its price. According to Shibburn, the official burn tracker of the token, 182,339,090 SHIB has been burnt just today.
SHIB total market cap at $4.4 billion on the daily chart | Chart: TradingView.com
On ETH Whales Activity And Hype Build-Up
The previous ETH whales activity also affected the burn rate of SHIB. In the past few days until today, a total of 322,781,348 SHIB that was burned can be attributed to whale activity. However, this presents a strong problem as a drop in price after whale accumulation means that retail investors are not participating in the market.
The reason for the non-participation in the crypto market is that they face a worsening economic situation. Retail investors might also be migrating their capital to safer assets that can hedge them from inflation like government bonds.
Meanwhile, investors and traders should be careful of the hype build-up. This hype builds speculative pressure on SHIB with a possible sell-off as Shibarium releases and the token reaches its peak price.
For short-term gain, a break above $0.00000826 price resistance will bring gains for investors and traders.
-Featured image: VOI