Two years ago, Shiba Inu (SHIB -3.73%) was the darling of the crypto world, but what's the state of play now? The surprisingly capable joke token ("joken?") reached its all-time record price of $0.00008845 per token on Oct. 27, 2021, and it has been a long ride downhill from there.
Let's imagine investing $10,000 in Shiba Inu at the very top of that cloud-tickling peak. How much would that investment be worth on Nov. 7, 2023?
Data source: Coinmarketcap.com.
Unfortunately, Shiba Inu's chart looks like a water slide. There's a steep drop at the start, followed by a flatter trajectory later. Today, that hypothetical $10,000 investment at the absolute peak would be worth just $909.
That's roughly 20% above the multiyear lows in the middle of June when our thought experiment was worth just $745. But the current value still sits 91% below the starting point.
Ouch, that hurts. Or should I say, what an incredible buying opportunity? Wait a minute, let's take a closer look at this divisive doggy.
Sniffing out Shiba Inu's road to recovery
Often dubbed the "DOGE killer" due to the Shiba Inu community's half-serious ambition to replace the ultra-popular Dogecoin cryptocurrency, this cryptocurrency started as a meme but has grown more serious over time. Shiba Inu has shown significant potential based on its solid theoretical underpinnings, the rock-solid technology of its Ethereum (CRYPTO: ETH) underpinnings, and strong community support.
To rebuild token-owner value, Shiba Inu has set its sights on "shedding another zero," aiming to push the price past the $0.00001 mark. That's not a terribly ambitious goal, less than 14% above the current price tag.
For Shiba Inu's value to recover from its substantial drop, several internal and external factors must work in the community's favor. Positive sentiment surrounding exchange-traded funds (ETFs) based on the spot price for Bitcoin (BTC -2.11%), particularly rumors about investments giant BlackRock's approval for an iShares-branded Bitcoin ETF, could create a sector-wide market momentum. This would very likely benefit altcoins such as Shiba Inu, too. We might even end up with Shiba Inu-based ETFs someday if the stars align just right.
Additionally, the Shiba Inu development team is working on new solutions that could boost investor confidence and help the cryptocurrency in regaining its lost value. Chiefly, its developers are looking for opportunities to provide smart contract functionality to the upcoming wave of decentralized finance (DeFi) and Web3 applications.
Many cryptocurrencies are throwing their hats into that valuable ring, so there are no guarantees of sudden success. But you can't win if you don't play, so it's good to see some activity on this front.
However, for a substantial recovery, the crypto market would need to enter a more sustained bullish phase. I mean, the end of the crypto winter, likely driven by broader financial trends, technological advancements, and increased adoption of cryptocurrencies in mainstream finance. Bitcoin's next "halvening" is coming up soon, which should put some extra spring in the trampoline. Shiba Inu's Ethereum backers plan to boost the whole network's transaction-handling performance over the next couple of years.
The interplay of these factors, along with the Shiba Inu project's own developmental milestones and community-building efforts, could determine Shiba Inu's trajectory in reclaiming its lost market capitalization.
Image source: Getty Images.
Barking up the right tree?
So, Shiba Inu investors who got in near the 2021 peak are looking at enormous paper losses so far. There are signs of better days ahead, but even if there's another bull market ahead for the crypto market, it could take many years to rebuild that crumbling $10,000 investment from two years ago.
For the rest of us, Shiba Inu offers a reasonable blend of lighthearted marketing, solid technical chops, and the potential to win some app development projects in the coming years. I wouldn't recommend backing up the digital truck to load it up with Shiba Inu tokens, but the crypto could be worth a small, speculative bet. Just make sure you can handle the unstoppable volatility around this adorable crypto token.
