Concerns After $1.7 Million Worth Of Ethereum Stuck In Shibarium Chain Bridge

Updated: 17 August 2023

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PeckShield, a distinguished blockchain security firm, recently revealed a troubling incident following the launch of the Ethereum Layer-2 network, Shibarium. As speculation brew that all that liquidity had vanished in thin air, Shiba Inu, lead developer, has come forward to quell the matter. Citing Shytoshi Kusama in a recent blog, “Your funds are safe.”

Before the event, there was a lot of expectation that it would drive the prices of dog-themed coins. However, the burble burst for traders who had taken long positions after $1.7 million worth of ETH was stuck in the chain.

Stuck Ether Delays Meme Coins’ Rally After Shibarium Launch

Shibarium, designed as a pivotal platform for optimizing the utility of the dog-themed tokens, was set to revolutionize the decentralized landscape. However, during its official debut, approximately $1.7 million worth of Ethereum was trapped in the Shibarium bridge. This raised concerns about the potential loss of these funds.

#PeckShieldAlert #Shibariumbridge https://t.co/8VyzqRug0G

— PeckShieldAlert (@PeckShieldAlert) August 17, 2023

This unexpected development has cast a shadow over the anticipated bullish momentum of meme coins. It led to substantial losses for Shiba Inu (SHIB), Bone ShibaSwap (BONE), LEASH, and TREAT.

The aftermath of its launch has defied expectations, with meme coins experiencing an unanticipated decline. SHIB and TREAT have seen a 10% decrease, while BONE and LEASH have faced even steeper drops of 17% and 25%, respectively, in the past 24 hours.

ShytoShi Kusama’s Message to Community Members About Shibarium Launch Incident

Shytoshi, a prominent figure within the ShibArmy, stepped forward to address the growing concerns.

https://t.co/mSnE6b9hMD

— Shytoshi Kusama™ (@ShytoshiKusama) August 17, 2023

He sought to dispel fears and set the record straight by denying any bridge-related issues and assuring participants of the security of their assets.

“Let’s deal with the FUD,” he started, adding that there was no bridge issue and that “Any screenshot you see of me saying any issue is false, and your funds are safe.”

Going further to explain the ordeal, Shytoshi noted that the challenges encountered were not inherent to Shibarium itself but were a result of an overwhelming surge in user activity and transactions immediately following the launch.

Massive influx of transactions and users that happened at the same time when we announced that Shibarium is live.

This sudden influx substantially strained the system’s scalability, prompting the decentralized team to rally their efforts to restore stability.

Shytoshi further revealed the staggering scale of the traffic surge, underscoring the formidable influence of the ShibArmy. Within just half an hour, the system recorded over 160 million compute units, highlighting the immense power of this decentralized community.

👉Traffic Surge: 📈

Shibarium's launch led to an incredible 160 million compute units in 30 minutes, way beyond the normal monthly limit of 400 million. This showcases the ShibArmy's strength and support. pic.twitter.com/i30WoG3XVn

— Samboi (@Tam259324557) August 17, 2023

Shytoshi acknowledged the collaborative endeavors of the team and external partners like Unification. Together, they worked tirelessly to enhance scalability and reinstate the chain’s resilience.

As investors grapple with uncertainty, Shytoshi’s insights provide crucial context and reassurance.

The incident underscores the unforeseen challenges that can arise within decentralized finance (DeFi). It also highlights the remarkable impact and strength of community-driven initiatives like ShibArmy.

Network Congestion in Cryptosphere

Nevertheless, it is impossible to ignore that network overloads have become a common issue when a system faces massive transactions. Recently, Binance Exchange suspended Bitcoin (BTC) withdrawals, citing network congestion. The incident influenced the largest exchange by trading volume to integrate the Lightning Network.

To prevent a similar recurrence in the future, our fees have been adjusted. We will continue to monitor on-chain activity and adjust accordingly if needed.

Our team has also been working on enabling BTC Lightning Network withdrawals, which will help in such situations.

— Binance (@binance) May 8, 2023

As the technical hurdles are addressed and the blockchain’s functionality is progressively restored, vigilance against misinformation and security risks remains paramount. The journey ahead demands patience and a steadfast commitment to the principles of decentralization that define projects like Shibarium.