Shiba Coin: Worthy Investment Or Risky Business?

Shiba Inu is a dog-themed meme coin that emerged in 2020 and quickly rose to fame in the digital world. It is a decentralised, community-building cryptocurrency built on the Ethereum blockchain network. Despite its small market cap, Shiba Inu has experienced extreme highs and lows, largely influenced by social media buzz and celebrity endorsements, including from Elon Musk. As of July 2024, Shiba Inu is priced at $0.0000165, with a market cap of around $9.6 billion, placing it in the top 15-20 largest cryptocurrencies by market cap. So, is Shiba Inu a good investment?

Shiba Inu is a highly speculative and volatile asset, making it a risky venture. Its value has fallen by over 90% on several occasions, and it is not widely accepted as a payment method. However, it has a limited supply of one quadrillion tokens, and its popularity could drive future price surges.

Whether Shiba Inu is a good investment depends on your risk tolerance and investment goals. It can be a great way to diversify your portfolio, and there is potential for significant financial growth. However, there are no guarantees of long-term growth, and it may not be suitable for the average investor due to its extreme volatility.

Shiba Inu's price history

Shiba Inu (SHIB) is a highly volatile cryptocurrency. Its price history has been a rollercoaster, with extreme highs and lows.

SHIB was created in August 2020 by an anonymous developer known as 'Ryoshi'. It is part of the dog-themed cryptocurrency family, which includes Dogecoin (DOGE) and Baby Dogecoin (BabyDoge). SHIB is a decentralised, community-led cryptocurrency, with an initial supply of one quadrillion coins.

The price of SHIB first surged in May 2021, when its pseudonymous creator sent half of the total supply to Vitalik Buterin, one of the co-founders of Ethereum, who burned 90% of his tokens. This increased the rarity of the remaining tokens and caused the price to skyrocket by 1,953% to $0.00003532. However, this high was short-lived, and the price soon plummeted by 90%.

SHIB saw another massive surge in October 2021, when Tesla CEO Elon Musk announced that Tesla electric cars could be bought with Dogecoin. This caused the price of SHIB to rally to $0.000075, a 1,200% increase. On 28 October 2021, SHIB recorded its all-time high of $0.000089.

However, the subsequent bear market of 2022 saw SHIB lose around 90% of its peak value. As of May 2024, the price of a Shiba Inu is $0.00002419, still down over 70% from its all-time high in 2021.

SHIB has been one of the most volatile crypto assets, and its price history has been heavily influenced by external factors, including social media sentiment, celebrity endorsements, and market conditions.

Shiba Inu's future outlook

Shiba Inu's future performance is challenging to forecast, as it is heavily influenced by unpredictable external factors such as social media trends, celebrity endorsements, and broader crypto market conditions. However, here are some key considerations regarding its future outlook:

Volatility and Risk:

Shiba Inu is an extremely volatile and speculative asset. Its value has fluctuated significantly, and it has experienced extreme highs and lows. It is not a stable investment and is subject to rapid changes. Therefore, it is crucial to approach investing in Shiba Inu with caution.

Influencers and Social Media:

The price of Shiba Inu has been heavily influenced by social media sentiment and celebrity endorsements, particularly Elon Musk's tweets. Positive mentions by influencers can drive up the price, while negative sentiments can lead to significant drops. This dynamic is expected to continue influencing the coin's performance.

Broader Crypto Market Conditions:

The performance of the broader crypto market can impact Shiba Inu's value. For example, the approval of Bitcoin exchange-traded funds (ETFs) in the US boosted the crypto market's legitimacy, positively affecting Shiba Inu's price. A broader bull market for cryptocurrencies could drive up Shiba Inu's price, while a "crypto winter" of stagnant prices can cause these markets to be forgotten.

Meme Coin Competition:

Shiba Inu's popularity and success have led to the creation of numerous similar meme coins, increasing competition within this space. The constant emergence of new coins could push Shiba Inu into the shadows and potentially dilute its market share.

Shibarium and Ecosystem Expansion:

The introduction of Shibarium, a layer-2 blockchain network built on Ethereum, has the potential to transform Shiba Inu from a simple meme coin into a comprehensive ecosystem. This development could positively impact its value and position in the cryptocurrency market. Additionally, the Shiba Inu ecosystem continues to evolve, with plans for the metaverse, games, and an improved ShibaSwap platform.

Limited Utility and Adoption:

Shiba Inu has a limited real-world utility as it is not widely accepted as a payment method. Its adoption has been primarily driven by social media hype rather than practical use cases. This limited adoption could hinder its long-term growth prospects.

Expert Opinions:

Market analysts generally caution against investing in Shiba Inu due to its high risk and volatility. They emphasize that it is not a suitable investment for the majority of investors. However, some experts acknowledge the potential for significant financial growth, especially for investors with a high-risk tolerance.

In conclusion, Shiba Inu's future outlook is highly uncertain. While it has the potential for substantial growth, it is also subject to extreme volatility and influenced by various external factors. Investors considering Shiba Inu should carefully assess their risk tolerance, conduct thorough research, and understand that there are no guarantees of long-term growth.

Pros and cons of investing in Shiba Inu

Pros of Investing in Shiba Inu

• Good diversification of investments
• Low cost for small investment options
• Potential for significant financial growth
• Shiba Inu has announced the upcoming launch of its own layer-2 blockchain network, known as Shibarium, which is expected to be introduced this year.
• Launch of its own metaverse, known as SHIB: The Metaverse. Over 100,000 virtual land plots have been made available, with many being bought before the launch.
• Shiba Inu is developing a play-to-earn game, and gaming veteran William Volk, who has worked with Activision and ROKiT Games, has been appointed as one of the leads for the project.
• Rolling out Shi: Shiba Inu is preparing to introduce the Shi stablecoin, which will be utilized on the Shibarium layer-2 blockchain. The purpose of the Shi stablecoin is to bring added value and uses to Shiba Inu, and it will be pegged at $1.
• Big roles of the whales: In July 2022, it was discovered that Shiba Inu had an advantage in the form of whales, as it was the second-largest holding among Ethereum whales, behind only USDC.
• Potential to be the top meme coin: Shiba Inu has emerged as a major competitor to Dogecoin, positioning itself as a potential top meme coin in the Crypto market.
• The element of founder anonymity: The anonymous nature of Shiba Inu’s founder(s) has been a contributing factor to its success, similar to how Bitcoin’s founder(s) anonymity helped dissociate the Crypto from any individual.

Cons of Investing in Shiba Inu

• No guarantees of long-term growth
• Historically, the value of Shiba Inu has fallen by more than 90% on several occasions
• Mystery: The decentralized nature of Shiba Inu is further compounded by the fact that its lead developer, Shytoshi Kusama, uses a pseudonym, and news about the project is only disseminated through occasional posts on Medium.
• Unconfirmed tokenomics: The lack of clarity around tokenomics can raise concerns about the credibility of a Crypto project.
• Competition: Shiba Inu faces stiff competition in the metaverse, layer-2 blockchain, and play-to-earn gaming space.
• Stablecoin dramas: The lack of information on the backing of the Shi stablecoin raises concerns.
• Lacks differentiating features: Shiba Inu faces a major challenge in terms of lacking unique features that differentiate it from the vast number of other Cryptos in the market.
• The opportunity for exponential gains may be gone: Shiba Inu gained significant attention during the 2020/21 bull rally, surging by an astounding 48,000,000%. While this brought Crypto into the spotlight, it also complicates its current investment potential.
• Shiba Inu is an ERC-20 token: Shiba Inu operates on the Ethereum blockchain and is an ERC-20 token, which comes with its advantages as Ethereum is a dominant platform. However, there are various potential risks associated with this, such as the fact that when Ethereum experiences a drop in value, ERC-20 tokens are likely to follow suit.

How to store Shiba Inu safely

Shiba Inu (SHIB) is a decentralised cryptocurrency that can be stored in a variety of wallets. Here are some ways to store your Shiba Inu safely:

Use a Dedicated Wallet

It is recommended to use a dedicated wallet for security and long-term storage. While you can store your coins on exchanges, it is generally safer to transfer them to a wallet that you control. This ensures that you are the only one who has access to your private keys and reduces the risk of theft or loss.

Hardware Wallets

Hardware wallets are considered the most secure way to store cryptocurrencies like Shiba Inu. These wallets store your private keys offline, making it difficult for hackers to access your funds. Examples of popular hardware wallets include the Ledger Nano S/X and Trezor One/Model T. These wallets have robust safety features and are ideal for those storing a large amount of value or planning to hold long-term. However, hardware wallets typically come with a cost.

Software Wallets

Software wallets are another option for storing your Shiba Inu. These wallets are usually free and can be installed on your desktop or mobile device. Examples include Freewallet, MetaMask, Trust Wallet, Exodus, and Coinomi. While software wallets are convenient, they may be more susceptible to hacking attempts or malware, so it's important to research the security features offered by each wallet before choosing one.

Paper Wallets

Another option for storing Shiba Inu is a paper wallet, which involves generating a pair of public and private keys and printing them on a piece of paper. This method ensures that your private keys are kept offline and minimises the risk of digital theft. However, it's important to note that paper wallets are still vulnerable to physical damage, theft, or loss, so they should be stored securely.

Multiple Wallets

For added security, you may consider using multiple wallets to store your Shiba Inu. By diversifying your storage, you reduce the risk of losing all your funds if one wallet is compromised. For example, you could use a hardware wallet for long-term storage and a software wallet for more frequent transactions.

Keep Your Recovery Phrase Safe

Regardless of the wallet you choose, it is essential to keep your recovery phrase or seed phrase safe. This phrase will allow you to recover your wallet and access your funds if you lose access to your device or forget your password. Store your recovery phrase in a secure location, such as a safe or deposit box, and consider creating multiple copies to protect against loss or damage.

Should you invest in Shiba Inu?

Shiba Inu is a highly speculative and volatile asset. It is a cryptocurrency with a small market cap, and its price can be influenced by social media trends and celebrity endorsements. While it has generated wealth for some, it is not a good investment for the vast majority of investors due to its high risk and unpredictable nature.

Shiba Inu (SHIB) is a decentralised, community-building cryptocurrency. It was created in August 2020 by an anonymous person named Ryoshi and is named after the Japanese dog breed, Shiba Inu. It is built on the Ethereum Blockchain Network and is a rival of Dogecoin (DOGE), often referred to as the "Dogecoin killer".

SHIB is a fork of Dogecoin and, like Dogecoin, is a decentralised, peer-to-peer digital currency. It enables users to send and receive payments without a central authority. It also has a faster block time than Dogecoin, taking just one minute compared to Dogecoin's ten minutes.

Shiba Inu has no official roadmap, as it is a decentralised platform. However, it has evolved into its own ecosystem, which includes the Doggy DAO, an active part of the Shiba Inu ecosystem, and the Shibarium L2, a Layer-2 solution to help avoid expensive transaction fees.

The price history of Shiba Inu has been volatile. It experienced a surge in November 2021, reaching an all-time high of $0.00006916 with a market capitalisation of $37.97 billion. However, it has also seen significant drops, falling by over 90% on several occasions. As of July 2024, the price of Shiba Inu is $0.0000165, which is still up from its starting price of $0.000000001009.

Shiba Inu is accepted as a payment method by about 40,000 merchants worldwide, and it has a dedicated fanbase that has helped it maintain its popularity despite struggling through the Crypto winter of 2022-2023.

While Shiba Inu has the potential for huge returns, it is a risky investment. Its future success depends on speculation and market sentiment, and it is difficult to predict how long its popularity will last. Additionally, it does not have much real-world utility, as it is not widely accepted as a payment method.

Therefore, investing in Shiba Inu is best suited for those with a high-risk tolerance and an appetite for the unpredictable nature of the memecoin market. For most investors, it should only be a small part of a more extensive portfolio. It is also essential to do your research, understand your risk tolerance, and consider seeking advice from a financial advisor before investing in cryptocurrencies.

Frequently asked questions