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Shiba Inu: Just A Meme Coin?

Written by

Nicholas W.

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What Is Shiba Inu?

Shiba Inu (SHIB) is a new cryptocurrency created in August 2020 by anonymous persons/person known as “Ryoshi.”  An Ethereum version of Dogecoin modeled after the Shiba Inu dog breed, its price has recently spiked, with a market cap of about $10 billion USD. 

Unlike Bitcoin, SHIB is very abundant, with a supply of 1 quadrillion (1,000,000,000,000,000). The SHIB ecosystem has an NFT art incubator and a decentralized exchange (DEX) Shibaswap with several associated coins. 

Similar to the Crypto Punk or Bored Ape NFT projects, Shiba Inu has its own pixelated NFTs. Shibaswap recently minted 10,000 “Shiboshis,” randomly generated NFTs, with varying traits to be utilized in an upcoming Shiboshi Game.

Shibaswap has two additional tokens, LEASH, and BONE. LEASH is a limited-supply token with only 107,646 in circulation, offering rewards for providing liquidity. BONE has 250,000,000 tokens in circulation and acts as a governance token, allowing its holders to vote on proposals in their Doggy Decentralized Autonomous Organization (DAO).

SHIB is available on many centralized and decentralized exchanges, recently listed on Coinbase. SHIB, of course, can be purchased on its own DEX and also on Ethereum DEX’s like Uniswap or Sushiswap. 

 

Is SHIB Just a Meme Coin?

SHIB is not taken seriously by most institutional investors and many in the cryptocurrency community. Similar to the original joke cryptocurrency Dogecoin, SHIB has a very active community and has shown a lot of resilience in the face of naysayers.  

As of October 2021, SHIB is $0.0000259 per coin with a total market cap of $10 billion USD. That’s more market cap than other ‘serious’ cryptocurrencies, such as Polygon (MATIC), Stellar (XLM), and Monero (XMR). 

Some may label SHIB a meme coin in a derogatory fashion, but this coin has had real-world effects. In somewhat of a marketing stunt, Ryoshi “burned” half of all SHIB to Ethereum co-founder Vitalik Buterin’s wallet early in 2021 (many dog-themed cryptocurrencies send their tokens to Buterin’s address). 

Vitalik burned 40% of the total supply to a dead wallet address but donated $1.2 billion USD worth of SHIB, 50 trillion tokens, to an India COVID relief fund.

To put this amount of money into perspective, black market oxygen tanks were $200 to $600 USD during India’s Spring 2021 COVID surge. If those SHIB tokens were converted to rupes, that could buy about 3 million oxygen tanks.

Vitalik said he would prefer that cryptocurrency creators directly donate to charities, not his wallet. 

Memecoins are created daily and shilled on social media even more frequently, but none have made a real-world impact like SHIB has.
 

Shiba Inu Today

Since September 2021, SHIB shot up ~200% due to some whales buying millions of USD worth of SHIB and retail traders jumping on the hype. SHIB is proof that retail traders, like Doge and Gamestop (GME) traders, still hold power. 

Shiba Inu’s active user base and easy-to-understand projects make it appealing to crypto newcomers. However, meme coins with substantial user bases of small traders can have many pump and dump groups, causing frequent price changes.  Expect volatility.


SHIB price chart from Coinbase


Some in the Shiba community will shill the coin on its way to $.10 or even $1, but these numbers are impossible. With a circulating supply of 400 trillion coins, $1 per SHIB would require a market cap of $400 trillion USD. 

Compared to the total market cap of the US stock market of $40 trillion, $1 or $.10 per SHIB is impossible. Having such an ample supply keeps the price per coin very low, making investing in such a “cheap” coin appealing.

Market cap, which is the number of coins multiplied by the price per coin, is more accurate in showing what the coin is actually worth. Keep this in mind when considering investing in SHIB.

On October 15th, 2021, Coin Cloud announced their ATMs would have the ability to purchase and trade SHIB. There are over 4,000 of these ATMs across the United States, expanding the reach of SHIB even more.

Given SHIB’s expansion into swapping, staking, farming, and NFT’s, it is clear this crypto is no longer just a meme coin but also a DeFi project and significant cryptocurrency.

All investing carries risk. Only invest what you can afford to lose.