Shiba Inu's Shibarium update has introduced a Burn Portal, offering a new way to reduce SHIB token supply, a move likely to affect the cryptocurrency's market dynamics.

Shiba Inu's Shibarium Adds Burn Gateway

As part of their Shibarium layer-2 solution, the Shiba Inu team has unveiled a burn gateway. It is standard practice in the industry to burn tokens in order to decrease the supply of a particular token.

A portion of the transaction fees was burned in 2021 with the implementation of Ethereum Improvement Proposal (EIP) 1559 during the London hard fork. This was done by providing a configurable block size that could be used as a proxy for network demand, U.Today shares.

The so-called "base fee," an algorithm-based required charge that scales with network usage, was introduced with the upgrade. At all times, the procedure burns the basic fee, meaning it destroys it. This was a catalyst for the deflationary narrative around Ethereum.

The Burn hard fork by Shibarium introduced the EIP-1559 functionality.

Flat Fee Locked In for Each Shibarium Transaction

The burn contract locks in a flat cost for every Shibarium transaction. The newly released ShibTorch will allow users to begin the burn process after they have accumulated enough BONE tokens.

At the moment, 100 BONE tokens is the minimum amount needed to start a burn. Once users link their wallets, they will be able to view the transaction hash and the exact quantity of SHIB that will be burned.

Keep in mind that the percentage of base fees that will be incinerated is just 70%. The remaining amount is sent to the national treasury. Through the Ethereum network, BONE tokens can be swapped for SHIB tokens.

Shibarium Burn Portal Could Drive SHIB Price Up

Eventually, these SHIB tokens will no longer be available for purchase. Because it has the ability to drastically cut the token supply, the burn portal's release is probably going to be a bullish trigger for SHIB.

Data from CoinGecko shows that SHIB rose by 0.8% on the last day. ​