Belgium (CoinChapter.com) — The cryptocurrency world is home to many projects that claim to be better versions of existing currencies. Shiba Inu – or SHIB – wants to dethrone Dogecoin as the leading meme token. Doing so will prove very difficult, even though the token has seen tremendous price action.
What Is SHIB Exactly?
As the native currency of the Shiba Inu ecosystem, SHIB exists as an ERC-20 token on the Ethereum blockchain. By taking on the label of “Dogecoin killer”, SHIB expects to outpace Dogecoin in market cap even at a lower value per coin. The recent price action certainly appears promising, even though there are still a lot of questions regarding its current circulation supply.
The Shiba ecosystem is also home to ShibaSwap, a native decentralized exchange with support for SHIB. An interesting development took place when Vitalik Buterin decided to burn 50% of the SHIB supply, of which he sent the proceeds to the India COVID-Crypto relief Fund. This 50 billion token transfer was worth around $1.14 billion when it took place. The remaining circulating supply is found on Uniswap, yet the coin creators claim to no longer hold the private keys.
SHIB Trading Takes A Bad Turn
As is often the case where relatively new tokens are concerned, there will be plenty of initial trading action. For SHIB, that trading took a near-immediate turn for the worse, resulting in plummeting prices across the board. Even though SHIB is still up by 12100% in the past 30 days, it seems unlikely that will remain the case for much longer. The chart below indicates there is plenty of bearish pressure for this pair at this time.
Such a strong market trend is not entirely surprising either. Many people see SHIB as a pump-and-dump currency, with the dump part now taking place after the recent price uptrend. Turning this market momentum around will pose a few challenges. One has to wonder if there is sufficient demand for a token that aims to “be a better Dogecoin” yet has none of the marketing appeal or community.
Is There Anything To Give It Value?
The concept of “value” and “price” can differ greatly from one currency to the next. For SHIB, there is no immediate appeal or value to speak of, even though 50% of its supply received a spotlight thanks to Vitalik Buterin’s help. Whether that will prove sufficient to keep it relevant is a different matter. The token is trading on all major exchanges, including Binance, Huobi Global, and OKEx. To some speculators, that is enough to give this asset value, despite the lack of real-world use cases.
Beyond that, the community is intent on getting SHIB listed on Robinhood. An interesting choice, as the platform, doesn’t let users control or withdraw their own assets. Even so, Dogecoin is on the Robinhood platform as well, thus adding Shiba Inu would make some degree of sense. Convincing such a prominent investment application to list a relatively unknown token that may not remain relevant for a long period is a big ask, though.
Closing Thoughts
Now that the initial excitement surrounding Shiba Inu has seemingly quieted down a bit, it will be interesting to see where the project goes next. There is likely to be even more market pressure with no apparent use cases or reasons to hold this token. However, coins mimicking the appeal of Dogecoin tend to note cycles of popularity, and anything remains possible where SHIB is concerned.
It is best to remain a bit cautious for those who want to chase profits with this token. Similar to other currencies noting recent price momentum, there will be plenty of volatility to contend with. Moreover, there are still concerns regarding the current circulating supply and whether any use cases will emerge. For now, SHIB is just another ERC-20 token that is suddenly gaining speculative attention and nothing else.
Header image by Pixabay, trading chart by Tradingview.
JP Buntinx has been writing about cryptocurrency since 2012. His interest in crypto, blockchain, fintech, and finance allows him to cover a broad range of different topics.
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