What happened
As of 2:30 p.m. ET on Friday, popular meme token Shiba Inu (SHIB -8.20%) had declined 5% over the past 24 hours to its lowest levels in more than two weeks. This decline came amid two pieces of news today that have investors wondering if this dog-inspired cryptocurrency has lost its touch.
First, a brag tweet from the Twitter account of the crypto BabyDoge (CCC) pointed out that this upstart meme token has more wallet addresses than Shiba Inu. Shiba Inu has surged to second place in market capitalization among dog-inspired meme tokens on the support of a massive and growing community. The idea that another small token has a larger following might be disturbing to some investors.
Second, Shiba Inu was not the top choice of retail investors who participated in a high-profile Twitter poll by Chuck Liddell. The former mixed martial arts champion asked his Twitter following to choose from among Shiba Inu, Dogecoin, and Safemoon to determine which had the strongest community. Safemoon took top spot, with 44% of the vote, while Shiba Inu came in second at 31%.
Image source: Getty Images.
So what
First we need to ask: Do these catalysts really matter? From a fundamental perspective, probably not. These Twitter battles are fun to watch from the outside looking in, but shouldn't matter for investors seeking to make a knowledgeable investment decision.
But for Shiba Inu investors, community is everything. The fact that the Twitterverse has spoken, and not in favor of Shiba Inu, is concerning to many die-hard Shiba Inu bulls.
Now, it should be noted that measuring wallet addresses holding a specific token isn't a very useful metric, in some respects. One individual crypto holder can have dozens or hundreds of accounts. Thus, it's hard to verify the actual user count supporting BabyDoge, or Shiba Inu for that matter.
And meme tokens go through peaks and troughs of community interest. Undoubtedly, Shiba Inu's following remains one of the biggest in the crypto world. Whether or not that's changing is a matter of perception.
Now what
The reality is that there are few fundamental drivers underpinning any meme token. This make these meme tokens untouchable for most conservative, long-term investor types.
Sure, these are fun to trade, and have made some folks filthy rich in a short amount of time. But whether it's Safemoon or Shiba Inu or Dogecoin, there's not really a lot of value underneath the surface. Thus, it's buyer beware with these tokens.
Has Shiba Inu lost its touch? Perhaps. There will always be something more bright and glamorous that comes along.
That said, in the world of meme tokens, anything's possible, as we've seen. I'm not going to make a prediction one way or another, because it will very likely be wrong.
