A week ago, I read news of whales buying trillions of SHIB tokens in anticipation of the launch of Shibarium that aims to transition the Shiba into a powerful Layer 2 ecosystem and enable it "to serve different industry areas such as metaverse, web3 innovation, and gaming."¹ But what is Shibarium exactly?
Let's try to take a closer look at it and what it attempts to do.
Shibarium is an upcoming layer 2 blockchain network built on top of the Ethereum blockchain for Shiba Inu. It aims "to increase transaction speed and lower costs in the Shiba Inu ecosystem."²
This layer aims, as a protocol, to work on top of existing blockchain networks, allowing for faster, cheaper, and more private transactions to be processed off-chain, while still relying on the security of the underlying blockchain.³
We know that applications built on the Ethereum blockchain suffer from scalability issues and that is why layer 2 solutions have been (and are still being) developed to tackle the problem. That's where Polygon, Arbitrum, Optimism and others come in.
Shiba Inu, being on Ethereum is not exempt from such issues, hence the Shibarium protocol. It intends to address and solve the scaling and network congestion that the blockchain is currently facing.
The upgrade looks to "address the high costs by offloading some of the transaction data to a dedicated Layer 2 infrastructure while retaining a direct connection to the Ethereum network. Not only that, Shibarium transactions are expected to burn SHIB, which could put significant deflationary pressure on the Shiba Inu coin and massively increase its value."⁴
So in simple terms, Shibarium is a layer 2 protocol that aims to increase transaction speed, lower costs, and offer a scalable solution for Shiba Inu applications.
Sometime in March, Shibarium beta called the "Puppynet" launched. The testnet seems to be progressing well and there were statements that we might be able to see the mainnet to launch in the second half of this year.⁵
According to information, PuppyNet has seen a robust activity, with over 20 million transactions from 16.7 million wallets. And the average transaction time being five seconds.
Shibarium is apparently being developed by the Shiba Inu community and whilst there had been no official announcement of its release, some teasers are already out, on Twitter X for instance, re:
And according to another teaser tweet in the last week of July, the Shibarium Beta Bridge has gone live for public testing⁶ which seems to be another indication that the mainnet is not far from launching.
$BONE will serve as the native token on the Shibarium network. It will be used to pay for gas transactions and reward validators and delegators within the upcoming Shibarium protocol. Sometime last month, there was an information to the Shiba community that the remaining BONE tokens will be minted and the token's smart contract will be renounced so "that no further minting will be possible."⁷
Shibarium validators will have to lock a certain amount of BONE (no indicated certain number) and operate Heimdall Validator and Bor block producer nodes. Rewards will be proportional to their stakes.⁸
Of the 250 million supply of BONE, 20 million is said to have been reserved to reward validators and delegators in the coming years, and voted in by the Shiba community through our DAO process.⁹ This means that the BONE token will serve both as a governance and utility token for the Shiba ecosystem.
Shibarium is being developed to scale the Shiba Inu blockchain, to speed up transactions and lower the costs thereto. It also aims to create a comprehensive ecosystem that will include features such as a metaverse, a decentralized exchange (DEX), and blockchain games.¹⁰
BONE, apart from being used as a governance token on Shibarium will be used for transaction fees and to reward delegators and validators too.
Will the launch of Shibarium propel SHIB token, including BONE and LEASH into reaching new heights? It would be interesting to see.
As always, none of these are financial or investment advice. Do your own due diligence.
Info Sources: Shiba Inu Blog / Coincodex / X
For infotainment only.
Lead image created on Canva. Photo from Shib Blog. No copyright infringement intended. 07082023/11:15ph
