The unveiling of Shibarium, the second-layer blockchain for Shiba Inu meme coin enthusiasts, took place on August 16, 2023. This innovative platform was introduced to address Ethereum’s scalability and transaction fee challenges while fostering the growth of decentralized apps. However, despite the celebration, the native cryptocurrency of the project, SHIB, experienced an 8% decline against the U.S. dollar, mirroring the broader downturn in the cryptocurrency market. Adding to the concerns, complications emerged with the Shibarium bridge, which left around $1.7 million worth of ether seemingly stuck in limbo.
Shibarium’s Challenging Beginning: Funds Held and a Strategic Move by a Large Crypto Holder
The Shiba Inu development team has finally launched Shibarium L2 blockchain, designed specifically for the SHIB, BONE, LEASH, and TREAT crypto assets. Revealed in the previous year, this network incorporates a fresh proof-of-stake (PoS) consensus mechanism called “proof-of-participation” (PoP).
In essence, validators commit their coins as collateral to validate transactions and generate new blocks. At present, Shibarium offers two primary functions: bridging the gap between the ETH blockchain and its own platform, and enabling token delegation for securing Bone rewards.
Looking to the future, though the option is not yet available, enthusiasts will have the opportunity to become validators and strengthen the network. Additionally, during Shibarium’s beta phase, 21 million distinct wallets were created prior to its official launch.
However, by Wednesday night around 10 p.m. Eastern Time, reports of Shibarium encountering issues started to emerge. It’s been reported that all ETH and BONE deposits directed to the Shibarium bridge have come to a halt. This includes a substantial amount of 600,000 BONE ($762K) and 954 ether ($1.7M). Furthermore, the Shibarium network faced difficulties in processing blocks, with no block confirmations occurring for over five hours since the problems began.
Some individuals believe that the developers will be able to rectify the situation, while those who deposited ETH into the bridge are feeling notably uneasy. Meanwhile, as Shibarium dealt with its challenges, onchain analysts from Lookonchain revealed that a major cryptocurrency ‘whale’ liquidated its entire holdings of BONE and SHIB to acquire PEPE tokens.
According to Lookonchain’s data, within the past three days, this whale sold “979,469 BONE in exchange for 787 ETH ($1.44M) at a rate of $1.47.” Following the disruption in Shibarium’s block production, this same whale transferred a significant 143 billion SHIB, valued at $1.32 million, to the Binance exchange.
What are your thoughts on the problems faced by Shiba Inu’s Shibarium network? Feel free to express your viewpoints and thoughts on this matter in the comment section below.
Frequently Asked Questions (FAQs) about Cryptocurrency Challenges
What was the purpose of Shibarium’s launch?
Shibarium, the second-layer blockchain, was introduced to address Ethereum’s scalability and transaction fee challenges while promoting decentralized app growth.
What was the reaction of SHIB’s value during the launch?
Amidst the celebration, SHIB, the native cryptocurrency, experienced an 8% decline against the U.S. dollar, reflecting the broader crypto market’s downturn.
What issues arose with the Shibarium bridge?
What features does Shibarium offer?
Shibarium introduces a new proof-of-stake (PoS) consensus mechanism called “proof-of-participation” (PoP). Validators commit coins as collateral to validate transactions and generate blocks.
What plans does Shibarium have for the future?
Enthusiasts will have the chance to become validators and contribute to strengthening the network, although this option is not yet available.
What strategic move did a cryptocurrency whale make during this time?
A significant crypto whale liquidated its holdings of BONE and SHIB to acquire PEPE tokens, showcasing strategic moves amidst Shibarium’s challenges.
How did onchain analysts respond to these events?
Onchain analysts from Lookonchain reported the whale’s activities, detailing the offloading of BONE and SHIB holdings and the subsequent transfer of SHIB to the Binance exchange.
More about Cryptocurrency Challenges
- Shiba Inu Coin Official Website
- Introduction to Second-Layer Blockchain
- Understanding Ethereum Scalability Challenges
- Explanation of Proof-of-Stake (PoS)
- Overview of Shiba Inu Token Family
- Explanation of Cryptocurrency Whales
- Lookonchain – Crypto Analysis Platform