Shiba Inu (SHIB 1.83%) is a well-known cryptocurrency network that sports a market cap of $5 billion (as of Dec. 6). Created to be a more functional blockchain when compared to predecessor rival Dogecoin, Shiba Inu has certainly made a name for itself in the community.
The meme token's price has absolutely skyrocketed throughout its history, going from $0.0000000001684 about five years ago to $0.000008439 today. However, the price has been on a troubling downward spiral, tanking 60% just this year. Risk-seeking investors might want to take a chance, but here are three reasons why I will never buy Shiba Inu.
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1. Shiba Inu doesn't solve a problem
Despite the industry having a total market cap of over $3 trillion, investors could argue that the vast majority of cryptocurrencies out there don't serve a real-world purpose. It's easy to argue that Shiba Inu falls into this category. Its price moves are dependent on various hype cycles, which are totally unpredictable and aren't rooted in anything fundamental.
Shiba Inu doesn't solve a problem. While there are interesting projects in place, like a metaverse, layer-2 blockchain, and a decentralized exchange, adoption is likely very tiny. And Shiba Inu doesn't crack the top 100 list when it comes to cryptos with the most developer activity.
2. The excitement is dwindling
During 2021, Shiba Inu went wild. It soared in the first half of May, and rose dramatically during October, before hitting its peak toward the end of that month on Oct. 27. The token's all-time high price is $0.00008845. However, today, it trades a gut-wrenching 90% off that record.
This long-term trend is hard to ignore, and it might indicate that the investment community is losing interest. Speculative behavior will always exist somewhere in the markets, but Shiba Inu's best days are probably behind it.
CRYPTO: SHIB
Key Data Points
3. Investors can find better places to allocate capital
There is a vast sea of digital assets to choose from, so investors don't have to gamble their money on tokens like Shiba Inu. For those who want crypto exposure, the best choice is Bitcoin. Bitcoin is aiming to fix the monetary system, which is characterized by colossal levels of government debt and constantly debasing fiat currencies. Its scarcity is its best trait.
Bitcoin continues to have meaningful upside as we look to the future. But if cryptocurrencies aren't of interest, then investors can choose to put their money in growth stocks that still satisfy the craving for a bit of risk and might also provide more upside. These are much better options than Shiba Inu.
