Yes, you definitely can put paper shreds in a bunny cage. My rabbit uses paper and there is no side effects. Not all papers are safe, though, because some papers are covered in chemicals that are not good for rabbits (or anyone!) to ingest. Paper is a lot of fun for rabbits to play with and tear up, so look for plain paper products and you should be fine: like newsprint or plain cardboard, with no glossy parts, no staples or tape, no stickers or labels, and not much colours/printing. Don't shred the paper first, though: let the rabbit shred the paper! The more things you give a rabbit to do, the less bored she'll be and the less she'll want to destroy your stuff!
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