Shibarium Dev Confirms Regulatory Roadblock Delays SHI Stablecoin Launch

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Shiba Inu’s Layer-2 blockchain Shibarium continues to expand its influence in the decentralized finance (DeFi) space, recently crossing a major milestone of over 1 billion transactions on the mainnet. Operating with an impressive 5-second average block time, Shibarium has propelled SHIB far beyond its meme coin reputation.

Shibarium’s TVL Dips After Hitting December Peak

According to DefiLlama, Shibarium currently holds $2.02 million in total value locked (TVL). Although this figure marks steady usage, it reflects a notable drop from the record high of $11.22 million in December 2024. Developers attribute the decline to ongoing delays in upgrades across the chain that are necessary for unlocking more DeFi potential.

While enhancing Shibarium, the developer team also continues work on ShibOS, a blockchain-based operating system that has already secured backing from the United Arab Emirates (UAE). In a significant nod to the ecosystem’s credibility, the UAE opted to integrate ShibOS at a federal level—largely due to its support for Fully Homomorphic Encryption (FHE), a privacy-preserving feature developed by Shibarium engineers.

SHI Stablecoin Still in Test Phase Amid Regulatory Delay

The concept of a native SHI stablecoin originated in 2021 when Shiba Inu’s mysterious founder Ryoshi introduced the vision of a one-cent pegged asset to power the ecosystem. However, the Shiba Inu devs, Kaal Dhairya and Shytoshi Kusama, have proceeded with caution, given the catastrophic collapse of Terra Luna’s algorithmic stablecoin in 2022.

Today, SHI remains under active development on the Shibarium testnet, known as Puppynet. Developers are focused on building a stable architecture that can securely maintain the 0.01 USD peg, especially for use with liquid staking derivatives (LSDs) across Shibarium and other compatible chains.

In a recent update on X, Kaal Dhairya confirmed that the delay stems primarily from regulatory uncertainty, stating that the team is “waiting on clear stablecoin regulations” before moving forward with SHI’s official launch.

U.S. Legislation May Unlock Stablecoin Rollout

Kaal likely referred to upcoming U.S. legislation, including the Digital Asset Market Structure and Investor Protection Act. If passed, this bill could clarify the regulatory framework surrounding stablecoins and potentially open the door for major companies like Microsoft, Amazon, and Apple to integrate stablecoins into their operations.

Such developments would align with Shiba Inu’s broader vision of institutional integration, something that hinges on regulatory transparency and long-term market stability.

Meanwhile, SHIB’s price action suggests a subtle rebound. On the technical front, SHIB briefly approached the upper Bollinger Band on April 10, indicating buying momentum. Though the price didn’t break through, it remains above the middle band, pointing to a gradual uptrend in the near term.

Conclusion: Patience and Progress in the SHIB Ecosystem

Shibarium’s developers continue to lay the groundwork for the future of SHIB, with infrastructure upgrades, global partnerships, and careful planning around SHI’s launch. While the regulatory landscape slows progress, the project’s long-term commitment to innovation and security continues to strengthen its position in the crypto ecosystem.