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Shibarium, the layer-2 blockchain of the Shiba Inu (SHIB) ecosystem, has suffered a 36% drop in Total Value Locked (TVL) in the last 24 hours. The decline is happening despite the price rebound recorded by SHIB within the same time frame.
Shibarium TVL drop signals reduced DeFi participation
According to DeFiLlama data, Shibarium Total Value Locked within this period amounted to $477,849. This indicates that more than one-third of the funds previously locked in Shibarium-based protocols have been withdrawn within the period.
It is likely that users who are withdrawing liquidity or DeFi protocols on the layer 2 are seeing less participation. It could also be a result of risk aversion among users in the ecosystem, as lending becomes less attractive to holders.
However, this does not mean that Shibarium is broken or that Shiba Inu is down. In fact, SHIB has rebounded on the crypto market as the meme coin registered a slight uptick in price. As of press time, Shiba Inu was changing hands at $0.000008719, which represents a 0.79% increase in the last 24 hours.
The dog-themed meme coin had earlier soared to $0.000009073 before registering a slight correction amid market volatility. Assets in the sector recorded an uptick following Bitcoin’s breakout above $95,000.
Shiba Inu is also enjoying increased trading volume, up 76.43% to $176.8 million. The rebound move of the coin into the $0.0000090 zone might have fueled anticipation that SHIB could be preparing to shed a zero if it sustains the current trajectory.
As U.Today reported, Shibarium might be experiencing a reset given recent developments in the ecosystem. Notably, the Shibarium network recently underwent security upgrade, which might be responsible for the drop in major metrics.
Security upgrade and privacy roadmap may explain TVL reset
Meanwhile, in the broader crypto space, privacy coins are gaining traction among users. This might have prompted the release of a privacy roadmap for Shibarium.
According to the timeline, before the end of 2026's second quarter, privacy and confidential smart contracts will appear on Shibarium and BONE, courtesy of Zama.
If successful, the development will make Shiba Inu blockchain one of the first consumer-ready ecosystems with real confidentiality.
The upgrade, according to Shiba Inu’s marketing executive, Lucie, would ensure that Shibarium gains full on-chain privacy. According to Lucie’s insight, the idea behind the launch of Zama is to resolve issues associated with transparent blockchains that expose contract data.
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