For months we have been following certain tokens like Shiba Inu and BabyDoge. Both tokens have numerous investors, but they are having a hard time gaining momentum. While Shiba Inu has managed to enter numerous trading platforms, the price still stays well below the “One Cent Dream”! Many of us investors wanted to believe the circulating supply wouldn’t be a factor in preventing Shiba Inu from making it to its destination of a penny! However, it looks like the circulating supply plays a vital role in how the token moves up in price.
While Shiba Inu has burns that take place here and there, the burns aren’t big enough to push the token upwards. Shiba Inu needs a bigger burn in order to regain momentum. Recently, we have seen BabyDoge take a more productive stance regarding burning and the token is starting to take off. A lot of these tokens with massive circulation are going to have to rethink the way they move forward. Developers are taking notes regarding what works and what doesn’t work.
Perhaps, therefore you now see tokens like Kishimoto performing strategically placed burns which remove larger amounts of tokens from the circulation pot. The burns help erase some of the circulation of tokens which helps the price eat zeros, at a faster pace. By now we know that circulation does play a vital role in how quickly a token is able to move up. Take $Mcontent and $BabyDoge as two examples, both tokens are at 8 zeros, but there is a stark difference in the number of investors. BabyDoge has over one million holders while Mcontent is nearing 14k, the difference is the number of tokens that are in circulation. Mcontent has a max supply of 10 quadrillion tokens with 39 percent being burnt, and they also have a burning feature in their monetization foundation. So, this means Mcontent has about 6 quadrillion tokens if not less because they have produced and are producing projects.
BabyDoge has a max supply of 420 quadrillion tokens, but over half have been burnt. We could be looking at a lot less than half by now because they have been actively burning which is perhaps the reason their token is rising. Would I say that these are bad tokens to own? No! However, I am not a financial advisor. Crypto is just getting started and everyone is trying to come up with the perfect formula on getting their token to the front of the line. As time goes on, I think we will see tokens burn more and perhaps developers tighten the girdle on token circulation down the road.
Does token circulation matter? Yes! If a token does not have a built-in burn function, the chances of the token getting to one cent or more will be nearly impossible. If I were just entering into the crypto maze; I would research token circulation, burn function, token sustainability, and the function that it aims to deliver. Perhaps, prior to all of that, I would like to know about the team behind the token. Keep in mind, we are early to the crypto party, so we might have to clean up a few messes before the other party-goers make it. However, l predict a new strategy regarding future token availability due to the struggle of reaching above one cent or more for tokens with 1 million investors, or more.
I am not saying they will not reach above a cent, but I am saying, it will take a strong solid burn function to get them there.