The Shiba Inu (SHIB) token’s price dropped over 7% Thursday after the bumpy launch of “Shibarium,” a layer 2 scaling solution on the Ethereum blockchain, earlier in the day.

See related article: Shiba Inu explained — diving beyond the memecoin

Fast facts

  • Soon after the launch of Shibarium, crypto data tracker PeckShield Alert noted that US$1.7 million worth of ETH was stuck as users tried to transfer tokens to Shibarium.
  • As the Shibarium bridging issue unfolded, the SHIB token’s price dropped, losing 7.34% in the 24 hours up to 17:00 p.m. in Hong Kong, according to data from CoinMarketCap. BONE, another token issued by the Shiba Inu developers, slumped 18.25% over the same period.
  • Pseudonymous blockchain analyst ZachXBT said on Thursday that Shibarium’s remote procedure call (RPC) — a blockchain node that runs key client applications —- had malfunctioned.
  • The Shibarium RPC website was down Thursday evening in Hong Kong.
  • Shibarium is part of a broader plan to make the memecoin into a serious blockchain project. But beyond the bridging malfunction, analysts expressed concerns about that strategy.
  • “Maybe the community preferred the memecoin-only narrative, rather than the foundation trying to be yet another solution in a crowded DeFi space,” said Justin d’Anethan, head of APAC business development at Belgium-based crypto market-maker Keyrock.
  • Unveiled at the ongoing Blockchain Futurist Conference in Toronto, Canada, Shibarium is a proof-of-stake blockchain built by Shiba Inu developers. It aims to allow cheaper and more scalable transactions on the main Ethereum network, its developers said.
  • Applications built on the network will use Shiba Inu ecosystem tokens SHIB, BONE, LEASH and TREAT.
  • The BONE token will validate transactions and work as a payment for gas fees, while SHIB will serve as the governance token of the SHIB Doggy DAO
  • A decentralized autonomous organization governing the Shiba Inu ecosystem in the future, the SHIB Doggy DAO — which is still under construction — will be advised by digital asset advisory and investment firm Alpha Transform Holdings.