Breaking: $1.7 million worth of Ethereum stuck in Shibarium bridge as launch fails to catalyze meme coin rally
- PeckShield blockchain security firm has reported a concerning incident following the launch of Ethereum Layer 2, Shibarium.
- Following the event, approximately $1.7 million worth of Ethereum was stuck in the bridge, with the possibility that it may not be recovered.
- The incident has violated expectations of bullish rallies for meme coins, with SHIB, BONE, LEASH, and TREAT recording massive losses.
Following the much-awaited launch of Ethereum Layer-2, Shibarium, PeckShield has reported that up to $1.7 million worth of Ether (ETH) has been stuck in the Shibarium bridge. With this, there is speculation that this liquidity may have caused the recent dip.
#PeckShieldAlert #Shibariumbridge https://t.co/8VyzqRug0G
— PeckShieldAlert (@PeckShieldAlert) August 17, 2023
The Shibarium chain is expected to act as a medium for optimum utilization of dog-themed tokens like Dogecoin (DOGE), Shiba Inu (SHIB), Bone ShibaSwap (BONE), TREAT, and the Doge killer, LEASH.
Surprisingly, while the launch was expected to push the price of meme coins up, things went sideways as the tokens plummeted. As of press time, SHIB is down 10%, with the same gong for TREAT, while BONE and LEASH are down a stark 17% and 25% respectively over the last 24 hours.
#PeckShieldAlert $BONE has dropped-17% https://t.co/tktwMsvXCd pic.twitter.com/sj4mGCzCfd
— PeckShieldAlert (@PeckShieldAlert) August 17, 2023
While the move is disappointing for the many new wallets that joined the network ahead of the Shibarium launch, all hope is not lost, with possibilities of recovery as network users begin reconciling with the change.
Meanwhile, an unconfirmed message from Shytoshi has fueled concern, suggesting it may be impossible to recovery the bridged tokens.
q3 2023
— smolting (wassie, verse) (@inversebrah) August 16, 2023
dogged pic.twitter.com/NSP7iLzPUe
Also Read: Shiba Inu price dips over 5% following the launch of Ethereum L2 chain Shibarium
Open Interest, funding rate FAQs
How does Open Interest affect cryptocurrency prices?
Higher Open Interest is associated with higher liquidity and new capital inflow to the market. This is considered the equivalent of increase in efficiency and the ongoing trend continues. When Open Interest decreases, it is considered a sign of liquidation in the market, investors are leaving and the overall demand for an asset is on a decline, fueling a bearish sentiment among investors.
How does Funding rate affect cryptocurrency prices?
Funding fees bridge the difference between spot prices and prices of futures contracts of an asset by increasing liquidation risks faced by traders. A consistently high and positive funding rate implies there is a bullish sentiment among market participants and there is an expectation of a price hike. A consistently negative funding rate for an asset implies a bearish sentiment, indicating that traders expect the cryptocurrency’s price to fall and a bearish trend reversal is likely to occur.
Author
Lockridge Okoth
FXStreet
Lockridge is a believer in the transformative power of crypto and the blockchain industry.
