Floki Inu, a meme coin born of fans and the SHIB community, has joined the class of emerging coins. The meme coin has seen tremendous performance in the past few hours following its reigning DAO presented an important development proposal.
The coin is a fierce competitor to the Shiba Inu, hence the name “Shiba Inu Killer”. As the people’s cryptocurrency (managed by a decentralized autonomous organization), Floki received a community proposal to burn an enormous number of its circulating tokens. After the bid was made, FLOKI saw a massive 25% price increase.
Reason behind Floki Inu performance
First, the developers of Floki Inu proposed a governance change that would shut down nearly $55 million worth of FLOKI. They also want to reduce the tax that users pay for transactions on the network. Finally, the proposal cited potential security risks related to bridges as an additional reason for burning so many tokens.
reports specified that over $2 billion was either misplaced or stolen from cross-chain bridges in 2022 alone. Therefore, the security reason given by the developers is valid.
Token burn is a means by which blockchain developers permanently retire some coins. It aims to reduce the total circulating token supply and increase the value of the asset, assuming demand does not change.
The proposal said that news of hack exploits points to the risks of cross-chain bridges, especially those with a large amount of tokens. It also said that any attack on Floki Inu’s primary cross-chain bridge would have a huge impact on the project.
The fact that said bridge holds 55.7% of FLOKI’s total circulating supply is another reason to consider the proposal. Additionally, if bad players exploit the vulnerability, it would result in Floki Inu’s liquidity pools being purged and the project consequently destroyed.
According to reportFloki Inu first conducted its token minting on Ethereum, with a total supply of 10 trillion FLOKI coins. Later, in response to the community’s request, they moved the mint to the BNB chain in 2021, making the process faster and cheaper.
According to historical DataToken burns often increase the value of an asset by reducing the number of tokens in circulation, thereby making the token scarce.
Most of the tokens, like Shiba Inu, BNB, etc. will be burned. Even Shiba Inu saw a significant rally a few days ago as token burn surged 613%. The high expectation of an increase in value after the planned token burn could be the reason for the recent price increase.
Floki’s price outlook
Due to the growing bullishness surrounding the token, its market cap and 24-hour trading volume are up 20%. Market capitalization of Floki Inu is currently $118 million while the trading volume is $4 million. The increasing market capitalization and trading volume indicate a growing interest in the FLOKI market.
Floki Inu is Trading at $0.00001694 with a bottom of $0.00001350. The token, like most cryptocurrencies, has seen significant rallies this year.
Floki Inu saw a 7-day price gain of 26%, a 14-day rally of 51.1%, and a 30-day rise of 53.2%. If the proposed token burn happens, FLOKI could see more push in the coming days.
Featured image from Pixabay, charts from Coinmarketcap
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