In 2021, many knew Shiba Inu (SHIB) to be the meme token that minted new millionaires in the crypto space. But years after achieving the feat, the Shiba Inu team wants the project to be recognized as a useful development rather than just a cryptocurrency aimed at making profits.
Because of this desire, the team developed Shibarium, a Layer Two (L2) ecosystem built on the Ethereum (ETH) blockchain. But what exactly is Shibarium and what does Shiba Inu aim to achieve with the network? Let’s dive straight in.
Shibarium: Explained In Simple Terms
As an evolving project, the SHIB team developed Shiba Inu as a blockchain network that would transform the Shiba Inu ecosystem into one with several use cases. Although launched in 2023, Shibarium was an idea conceptualized in 2021 by Ryoshi.
For the unfamiliar, Ryoshi is the pseudonymous creator of Shiba Inu. In addition, the development of Shibarium was to ensure that the troubles of high gas fees and slow transactions on the Ethereum blockchain were solved.
While the project is still in its early stages, its Mainnet launch has attracted a lot of attention. Due to the traction Shibarium has, many wallets have been created on it, with thousands of transactions executed on the blockchain.
According to the Shibarium Explorer, over 700,000 transactions have taken place on the network. Also, these transactions were performed between 635,179 addresses. The surge in transactions and wallets implies that the crypt community may have considered Shibarium as a project that could remain relevant in the long term. Now, let’s break down how Shibarium helps the Shiba Inu ecosystem.
How the Shibarium Network Helps the Shiba Inu Ecosystem
Like any project, no new development goes live without any function, and it’s the same case for Shibarium. There are several ways Shibarium contributes to the Shiba Inu ecosystem. For the purpose of this article, we will take a look at four separate use cases.
Transaction Costs Reduction
As you probably know, one of the drawbacks of the Ethereum Mainnet is that gas fees can be extremely expensive. Although several L2s have emerged to solve the problem, no one has come from the meme token sector of the crypto market.
However, with Shibarium’s development, users can now access lower fees for transactions with ETH. So, instead of paying $50 for a $100 transaction, users can get lower fees through the Shibarium network.
Decentralized Exchange Access
Another utility Shibarium has provided is access to Decentralized Exchanges (DEXes) built by the SHIB ecosystem. While there are existing exchanges like Uniswap, and SushiSwap, Shibaroium’s involvement offers another option for users who may have several challenges using the other DEXes.
As of this writing, a number of DEXes have appeared on the Shibarium network. Some of these include Shibex, BoneDex, DogSwap, ShibFi, and a host of others. The development of these platforms has also influenced the Total Value Locked (TVL) of Shibarium.
By definition, the TVL is the total value of assets staked or locked in a DeFi protocol. At the time of writing, Shibarium’s TVL was $1.25 million. This means that the liquid inflow into the ecosystem has been relatively impressive since its official launch.
Decentralized Application (DApp) Development
Third on the list is the development of decentralized applications. Like any other L2, Shibarium provides an avenue for the creation of these open-source applications. Since DApps run on a peer-to-peer consensus, users can interact with the network and perform transactions with the interference of a centralized authority.
Access to Several Tokens
Here’s where it gets interesting. Unlike previous cycles when SHIB was the only token on the Shiba Inu network, the introduction of Shibarium has brought about the emergence of new tokens. So, there are three official tokens operating on the network, namely Shiba Inu (SHIB), Bone ShibaSwap (BONE), and DogeKiller (LEASH).
Another interesting thing is that these tokens are not merely meme tokens. Instead, they have use cases for market participants who decide to hold them.
Shiba Inu (SHIB)
As the most popular token out of the three, SHIB also has the highest market cap. Based on CoinMarketCap’s data, the market of SHIB is $4.69 billion. It also has a circulating supply of 589.35 trillion.
In terms of utility, SHIB has grown to become a payment token either directly or through third-party platforms. While Shiba Inu may have developed a complete ecosystem, the price of SHIB has been underwhelming in recent times. In the last 365 days, SHIB’s price has decreased by 35.24%, trading at $0.0000079 at the time of writing.
Bone ShibaSwap (BONE)
Next on the list is BONE. With a market cap of $272.48 million, BONE’s price was $1.19 as of this writing. The token functions as the governance of the ShibaSwap DEX. So, BONE holders have access to voting on proposals and also access Non-Fungible Tokens (NFTs) that may be built on Shibarium in the future.
Tagged as the killer of Dogecoin (DOGE), LEASH has a lower market cap than SHIB and BONE. According to CoinMarketCap, the market cap of BONE was $43.48 million while its price was $409.09.
There are also 106,299 LEASH tokens in circulation. LEASH can be traded on the ShibaSwap DEX. Like BONE, LEASH serves as a governance token while holders can also get lucrative rewards for participating in proposals.
In conclusion, one would admit that the Shiba Inu team has done well by introducing Shibarium. However, the development of the L2 is no guarantee for the SHIB price to soar. At the same, market players can at least, consider another option when looking to network with low gas costs.
Furthermore, Shibarium has the potential to develop much better than its current use cases. For instance, if the metaverse proves to be a solid project in the future, Shibarium can also gain since it was creating lands in the metaverse using the network.