- Shiba Inu's latest metaverse announcement is indicative of everything that's wrong with the token.
- The new metaverse website is little more than a page with a dog -- it has no concrete information or tastes of its virtual world.
- The decision to sell virtual land in Ethereum rather than Shiba Inu sparked criticism from Dogecoin's co-founder Billy Marcus.
Every dog has its day, but Shiba Inu may not be quite ready for the Westminster Kennel Club.
Shiba Inu (SHIB) talks a good game. Reading the meme crypto's Twitter feed and white paper (called a "woof paper") is like playing buzzword bingo for meme projects and indeed crypto in general. Metaverse? Check. DeFi? Check. Crypto gaming? Check. Community? Check. Celebrity buddy? Check. And of course, the now obligatory Shiba Inu dog. Bingo.
But for all the talk, Shiba Inu just isn't built on solid foundations. Once you scratch the surface, there are too many things that don't quite add up. For example, its woof paper describes Ethereum founder Vitalik Buterin as a "friend of SHIB." But the crypto visionary didn't want or ask to be given 50% of SHIB tokens -- it was most likely a marketing stunt. Similarly, Buterin's decision to donate tokens to an Indian COVID relief fund was his alone, and had nothing to do with Shiba Inu.
The main driver for price increases seems to be token burning -- deliberately taking coins out of circulation. It is a bit like a stock buyback that essentially increases the price of a crypto. And SHIB's market cap -- the total number of tokens multiplied by the price -- has only increased by about 200% since last June. Its latest metaverse project is symptomatic of Shiba Inu's tendency toward hype over substance. Here are some of the reasons why:
1. Making a dog's dinner out of its metaverse launch with needless hype
Two days before Shiba Inu's metaverse announcement, the team tweeted a teaser, telling people: "See, the world is full of things more powerful than us. But if you know how to catch a ride, you can go places. Stay tuned for March 30." This sparked all kinds of speculation about what the announcement would be, but in the end it didn't add much to what we already knew.
The lengthy announcement contained info about how many plots of land would be on sale, a URL for a new website that isn't up and running, and another mention of its Shibarium layer 2 solution. But we already knew a lot of that. And unsurprisingly, Shibarium, which would reduce transaction fees, is not yet ready. If it had been, that might have actually warranted a little hype. SHIB needs to start making announcements about thing's it's done, not things it plans to do.
2. Selling land in ETH, not SHIB
According to Shiba Inu's announcement, there will be 100,595 plots of land in its virtual world, and about a third of them will be for sale. What's strange is that none of the plots can be bought with SHIB. Loyal SHIB fans need to use Ethereum (ETH) to buy land in its virtual world. The reason? According to the release, "Using our Ecosystem Tokens is a risk, as we would need to dump our own tokens' price cashing them! And that’s far away from our plans.”
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That doesn't make sense. Dogecoin co-founder Billy Marcus summed it up, tweeting: “How is making a random metaverse and selling fake land with Ethereum adding utility to their project?" He added, "I mean whatever, if people wanna give the devs even more money go ahead, but if I was a SHIB holder I would be annoyed.”
3. It doesn't yet have a metaverse
Metaverses took the crypto world by storm last year, but building metaverses takes time. It isn't the same as a crypto token that can be developed in a couple of hours. For example, one popular project, The Sandbox (SAND), took four years to build and is still launching its world in phases. I don't expect Shiba Inu to release a new functioning virtual world in a matter of months, but so far there's nothing there.
Compare this to some of the other promising metaverse projects in development. Their websites contain information about the technology used, teasers of what the world might look like, links to NFT galleries, and roadmaps for development. Shiba Inu has none of this. If you go to the new website, the only thing that's there is a static picture of a dog in a forest.
Shiba Inu's red flags aren't going away
We still don't know who is behind Shiba Inu, and an anonymous founder is a big red flag for a project of this size. Moreover, its tendency to over-promote and under-deliver is triggering alarm bells. It needs to do more than generate hype and make promises.
It's time for Shiba Inu to stop jumping on every passing bandwagon and start to deliver. For example, it could develop its decentralized exchange into a product that can compete with projects like Uniswap or Pancake Swap. Or build a metaverse that holds its own against other virtual worlds.
I don't have a dog in this race -- I don't own Shiba Inu. And I don't want to offend the rank and file of the loyal ShibArmy. If you get pleasure out of the community, that's great. But if you're considering buying SHIB tokens, be cautious.
For investors, there are many solid cryptocurrency projects with real purpose and the vision to make real-world changes. Sure, they still carry risks -- there's so much we don't know about how this industry will evolve. But they are not made-up dogs howling at the moon.
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Emma Newbery owns Ethereum. The Motley Fool owns shares of and recommends Bitcoin.
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