Benzinga - Shibburn, a Shiba Inu (CRYPTO: SHIB) data tracker, addressed the misconception surrounding Ethereum (CRYPTO: ETH) co-creator Vitalik Buterin’s burn of $1.7 billion worth of SHIB tokens back in May 2021.
What Happened: Contrary to popular belief, Shibburn said Buterin did not spend that amount to burn the tokens and it did not directly impact the price at the time.
The tokens were actually gifted to Buterin when the token was initially deployed. "Transferring 90% of what was given to him from one wallet to another (burn address) months later does not make the price go up," Shibaburn said in a post on X (formerly Twitter).
Shibburn said that the surge in price observed in May 2021 was due to the increasing demand as more people discovered and invested in SHIB. It is worth noting that at the time, half of the token’s total supply was held by Buterin, which potentially contributed to its value skyrocketing by over 46,000,000%. Since May 6, 2021, SHIB has maintained a steady increase of 5 times its initial value.
Just to clarify something on Vitalik Buterin's burn. He did not spend $1.7B in $SHIB to burn on May 2021 for it to have any effect on price then. That was given to him when the token was deployed. Transferring 90% of what was given to him from one wallet to another (burn address)… pic.twitter.com/QCpRAnlIwz— Shibburn (@shibburn) September 6, 2023
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Why It Matters: Burning refers to the act of sending a token to an unusable account and removing it from circulation, which diminishes supply and increases its scarcity.
The detailed transaction is publicly available on Etherscan, where the transfer of the tokens can be seen from one wallet to the burn address.
Buterin had earlier said "I’ve decided to burn 90% of the remaining shiba tokens in my wallet. The remaining 10% will be sent to a (not yet decided) charity with similar values to cryptorelief (preventing large-scale loss of life) but with a more long-term orientation," wrote Buterin in the transaction hash.
In the past 24 hours, 24 million Shiba Inu were burnt and permanently removed from circulation.
Price Action: At the time of writing, SHIB was trading at $0.0000076, down 0.42% in the last 24 hours, according to Benzinga Pro.
Photo by Dennis Diatel on Shutterstock
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