There are a number of dog-inspired cryptocurrencies out there. Dogecoin is probably the first that comes to mind. But there's also Shiba Inu (SHIB 0.99%), which has produced a monster return of 529,000% since its launch in August 2020. This remarkable price performance even incorporates SHIB's 90% fall over the past 14 months.
What are the chances that Shiba Inu, currently the 16th most valuable cryptocurrency with a market cap of just under $5 billion (as of this writing), reaches $1 in 2023? Let's take a closer look at how likely, or unlikely, this is.
CRYPTO: SHIB
Key Data Points
Background on Shiba Inu
Seeing the limitations with Dogecoin, the dog-themed meme token of its predecessor, the founders of Shiba Inu made its token, SHIB, compatible with the vast Ethereum ecosystem, thus connecting it to different protocols. Shiba Inu launched with an initial supply of 1 quadrillion tokens. But after many were burned, the current total in circulation is 549 trillion, according to coinmarketcap.com.
If these numbers seem absurd, that's because they are. Unlike Bitcoin, for example, that has a fixed supply cap of 21 million, Shiba Inu was made to be intentionally abundant, and this is why the token price is so low. The tokens can be used for payments, but this hasn't really caught on, and only roughly 500 merchants accept SHIB.
That's because Shiba Inu possesses no real competitive edge among the 22,000 cryptos out there. It really only caught on because it rode the meme-stock craze that took over markets in the spring of 2021. Retail investors were enamored of the possibility of getting rich quickly, a poor basis for a sound investing philosophy.
To it's credit, Shiba Inu does have some interesting things in the works that could drive greater utility, such as a Layer2 scaling solution known as Shibarium, as well as a non-fungible token-powered metaverse. But why would any developer or user be attracted to Shiba Inu when they can take their time, talent, and dollars to Ethereum, which has a tremendous number of decentralized applications running on it? In addition, Ethereum has a longer operating history and a more robust development pipeline than Shiba Inu.
A $1 price target isn't likely
As of the evening of Jan. 4, the price of one SHIB token was $0.000008537. If SHIB were to hit $1 by the end of 2023, this would imply a gargantuan return of nearly 12,000,000%. And at $1, Shiba Inu's market cap, assuming there are the same number of tokens outstanding, would total a whopping $549 trillion.
Let's put this ridiculous figure in context. For comparison's sake, Apple, the world's most valuable company, has a current market cap of $2 trillion. And the entire gross domestic product of the U.S., the world's wealthiest country, is $23 trillion.
This makes it almost impossible for Shiba Inu to hit the $1 mark not just in 2023, but ever. In fact, the highest price SHIB has ever been at is just under $0.00009 in October 2021. Hoping for it to reach $1 is a loser's game. Those who were lucky enough to get in at SHIB's launch and ride it on the way up certainly made life-changing returns. But that's a thing of the past.
Investors are better off avoiding this meme token at all costs. If you want to invest in digital assets, stay focused on the most popular ones, like Bitcoin and Ethereum. Additionally, only put a small amount (no more than 1%) of a well-diversified portfolio in these assets. This will help you keep your peace of mind.
