Shiba Inu, often touted as the 'Dogecoin killer,' is another dog-themed meme coin that has garnered significant traction due to its outstanding performance in 2021, when it became the center of attention from the WallStreetBets community on Reddit. Since then, however, the initial interest has cooled down as Shiba Inu's price tanked 91% from its ATH, taking the recent blow after the long-awaited yet underwhelming launch of Shibarium, its Layer 2 blockchain built on Ethereum.
As with all meme coins, Shiba Inu thrives on social media buzz and celebrity endorsements. However, due to the ubiquity of meme coins these days — the new ones are popping up like mushrooms after the rain and often live just as long — it becomes more and more challenging to keep the project running on the meme fuel only.
To stay relevant, Shiba Inu has to evolve beyond its current status of a meme coin and become a serious DeFi project, albeit with humorous origins. The centerpiece of this new vision is Shibarium, Shiba Inu's buzzy L2 believed by the community to open a new chapter in SHIB's history. Its recent launch, however, was bugged by serious technical issues, leading to at least $1.8 million worth of bridged funds being stuck in a pending state. Shibarium hiccups have set back Shiba Inu price, which declined 10% in 24 hours post-launch, while the ecosystem tokens BONE and LEASH have dropped by 13% and 25%, respectively.
For now, it seems that the much-hyped launch failed to deliver on the expectations placed on it by the community, which in turn raises the questions: What's next for the Shiba Inu ecosystem? Is Shiba Inu dead? And will it recover in the near future? Read on to find out!
Shiba Inu overview
Shiba Inu (SHIB) is an Ethereum-based ERC-20 meme coin that was created as a "Dogecoin killer" and was inspired by the Japanese dog breed of the same name. Since its inception in August 2020, the token won the hearts of retail crypto investors worldwide, who collectively refer to themselves as SHIBArmy. Thanks to its humorous origins and charity initiatives (such as a rescue campaign for Shiba Inu dogs) the project boasts one of the strongest communities, amassing 3.7 million followers on Twitter — more than leading crypto companies such as Ethereum Foundation, Kraken, and Tether.
Originally, meme coins gained popularity due to their association with internet memes and viral content, offering little actual utility. Shiba Inu, however, aims to break from its reputation as a meme coin, providing more value to SHIB holders with a foray into DeFi, building a vibrant ecosystem tailored for metaverse and gaming use cases. The key components of this vision are:
Decentralized exchange (DEX) ShibaSwap: a peer-to-peer trading platform similar to Uniswap that uses SHIB as its native token in addition to its two native tokens BONE and LEASH
Bone ShibaSwap token (BONE): Governance token of ShibaSwap that allows holders to propose or vote in the Shiba Inu Doggy DAO on potential ecosystem upgrades or changes.
Doge Killer token (LEASH): Initially designed to be DOGE’s elastic token that would track the price of DOGE at a rate of 1/1,000, LEASH was later repurposed to serve as a simple store of value after it lost its peg.
SHIB The Metaverse: Shiba Inu's metaverse would feature 100,595 plots of virtual land and make use of both SHIB and BONE tokens. Running on top of Shibarium, SHIBverse is expected to launch somewhere by the end of 2023, with four hubs — Ryoshi, Wagmi, Tech Trench, and Rocket Pond — scheduled for release in September.
Another distinct feature of the Shiba Inu ecosystem that we can't leave unmentioned is the SHIB supply, which started with an astronomical 1 quadrillion tokens, designed to be gradually reduced through an automatic burn mechanism that is inextricably tied to the network's transactions. The most notable burn of SHIB tokens occurred shortly after the launch of Shiba Inu, when its anonymous founder Ryoshi sent half of the token's total supply to Ethereum co-founder Vitalik Buterin, while the other half was locked in the Uniswap pool for liquidity. Buterin burned most of the coins gifted to him and donated the rest (worth about $1.2 billion at the time) to an Indian COVID-19 relief fund and some other charities.
At the time of writing, SHIB supply in circulation is 589 trillion tokens, while the price of one Shiba Inu token stands at $0.000008448, down over 13% in the last week but up 6% in the last 24 hours.
Why is Shiba Inu down?
The most recent Shiba Inu's decline can be attributed to the botched launch of Shibarium, which was marred by a network outage and a faulty bridge. Shibarium was conceived as a backbone of the broader strategy to turn the Shiba Inu coin into a DeFi powerhouse.
However, after launching on August 16, the blockchain ran into serious technical issues that saw more than 1,003 ETH ($1.8 million) stuck on a bridge. Shiba Inu developers blamed the faulty launch on unprecedented demand that overloaded the network with transactions beyond the handling capacity of the servers. As a result, SHIB plunged some 10% at the time.
Now that these errors were supposedly fixed by the Shiba Inu team, Shibarium is "almost ready" for reopening, the project's lead Shytoshi Kusama stated in their blog post.
“After two days of testing and tweaking parameters to achieve a 'ready' state, Shibarium is now enhanced and optimized,” Kusama wrote. “As mentioned, it is still in testing, but producing blocks. Moreover, we have enabled a new monitoring system and additional fail safes, including rate limiting at the RPC level and auto server reset in case we get a huge level of traffic again.”
The developer also added that the network will welcome additional validators, after which “testing will wrap up, and we will prepare for public consumption once again.”
Perhaps another reason for SHIB’s price decrease has been the recent crypto market selloff that followed the news of Musk's SpaceX dumping its Bitcoin holdings and mounting worries about China's economy and rising interest rates.
What's next for Shiba Inu?
Just like many other meme projects that emerged during the 2020-2021 bull run, Shiba Inu lost most of its gains since, down more than 90% from its October 2021 all-time high. While the project has done an impressive job generating hype on social media and building a community of die-hard SHIB bulls, its real-world use cases are basically non-existent given its $5 billion market cap. Although its valuation certainly reflects the community premium, the project doesn't attract much interest outside of SHIBArmy.
Ultimately, Shiba Inu's future will depend on whether its team will succeed in creating value for Shiba Inu holders with the launch of Shibarium and increased focus on GameFi use cases, providing fuel for the next run-up. While the first release of Shibarium was definitely underwhelming, the successful relaunch could send the price of a token soaring, provided that the transaction costs are minimal and that Shibarium is really capable of supporting all the promised pillars of the new ecosystem.
Shiba Inu vs Dogecoin: which one is a better buy?
No story about Shiba Inu would be complete without mentioning its ultimate rival Dogecoin, which holds the crown of the first meme coin. If you have been recently thinking about adding some meme coins to your crypto portfolio, you probably wonder which one — Doge or SHIB — would be a more lucrative option. Let's take a closer look at both, along with their pros, cons, and utility.
The bull case for Shibu Inu
Strong community: In 2023, Shiba Inu became the second most searched cryptocurrency after Bitcoin, and the number of investors holding SHIB on-chain is estimated at 1.3 million, without taking into account users who store their tokens on centralized exchanges.
Shibarium: The long-awaited launch of Shiba Inu's Layer 2 network is expected to open a new chapter in the meme coin's history, allowing devs to focus on Metaverse and gaming use cases. This can potentially attract new users who are interested
Burn mechanisms: Every transaction on Shibarium will burn SHIB tokens paid for gas fees, so strong adoption of the new L2 would mean a sizeable reduction in token supply, which, in turn, can boost SHIB price.
Reasons to be bearish on Shiba Inu
No relaunch date: While the relaunch of Shibarium is promised "soon," the exact date remains unknown, and so does the scale of network issues that the devs have to fix before the release. There is still a possibility that the network will run again into severe technical issues or fall victim to hacks or exploits that often follow newly launched projects.
Murky vision: It's still unclear what will be built on top of Shibarium. Yes, there are plans to launch four Shibverse hubs in September, but little is disclosed about the experiences they offer. Although it was mentioned that users will be able to buy virtual land, build new objects from scratch, monetize their creations, and interact with other players, the unique value proposition of such a venture is questionable.
Giant token supply: Finally, Shiba Inu's token supply is just too big. While the coin’s low price per unit makes it appear accessible to more investors, the current 589 trillion Shiba Inu coins hinder any meaningful token appreciation until more coins are burned.
The bull case for Dogecoin
Elon Musk's support: the world's richest man has long been Dogecoin's vocal supporter, and his tweets and comments have on several occasions sent DOGE price soaring. Furthermore, Musk has been advising the Dogecoin developers since 2019 and was even voted honorary Dogecoin CEO around the same time.
Possible integration with Twitter: With Elon Musk having taken control of Twitter and planning to turn it into an "everything app" X, it's possible that Dogecoin may be integrated with the platform. In July, the eccentric billionaire even added a DOGE symbol to a location on his Twitter bio after X rebranding, and earlier on April Fools' Day replaced the blue bird logo with a Doge mascot.
Strong adoption: In the past 2 years, DOGE has enjoyed increased adoption, with Dogecoin payment integrations provided by third parties like BitPay and Coinbase and several providers releasing prepaid cards supporting Dogecoin as a funding source. Many well-known companies accept DOGE for their goods and services, including Tesla (obviously), Newegg, Twitch, AirBaltic, AMC, and GameStop.
Reasons to be bearish on Dogecoin
Lack of use cases: While Shiba Inu is actively trying to get rid of its meme coin label, the Dogecoin community explicitly states that their beloved crypto has no utility besides being a simple medium of exchange. Although money surely has tremendous utility, being money usually comes prepackaged with nearly every crypto coin, and there's virtually nothing that would set DOGE apart from other payment-based tokens.
Musk's Dogecoin lawsuit: Elon Musk is being accused of insider trading in a class action lawsuit by DOGE investors, who say that the Tesla CEO used Twitter posts, paid online influencers, and his numerous publicity stunts to manipulate the price of a coin at community's expense. Although the billionaire denied all allegations, and his lawyers filed a motion to dismiss the suit, the law scrutiny can certainly tamper the tech mogul's enthusiasm toward the meme currency.
So, is Shiba Inu dead?
Putting it all together, to proclaim Shiba Inu as "dead" would be a premature move for now, as cryptocurrencies, especially meme coins, are known for their resilience and volatility. While Shiba Inu's current transition from meme currency to a serious blockchain project has been marred by technical issues and delays, it may pay to watch closely the developments in the Shiba Inu ecosystem to see how its broader vision plays in real life.
It's worth remembering, however, that there are several challenges that lie ahead for Shiba Inu. Its massive token supply, combined with uncertainties surrounding Shibarium and a yet-to-be-clearly defined long-term vision, can be sources of concern for potential SHIB investors. On a brighter note, its devoted community hasn't forgotten the millionaire-making potential of this coin, so they're unlikely to sell their favorite meme token.
That being said, Shiba Inu's future hinges on strategic decisions, community involvement, and market dynamics. If the crypto market enters a bullish trend again, it's certainly possible that the rising tide could bring big gains for Shiba Inu and other altcoins.
Where can I buy Shiba Inu?
The best way to get Shiba Inu coins is to buy them from crypto exchanges, both centralized and decentralized, such as Binance, Coinbase, Uniswap, Kraken, and KuCoin. However, there are also alternative ways, such as buying Shiba Inu directly from other people on p2p marketplaces or from ATMs that support this coin.
Who created Shiba Inu?
Shiba Inu coin was created in August 2020 by an anonymous person or group of people known as Ryoshi. Very little is known about the mysterious crypto founder, who, in the early days of the projects, told the community that: "I am a nobody, I am not important. The efforts to unmask my “identity” even if successful would be underwhelming. I am just some guy of no consequence tapping at a keyboard and I am replaceable. I am Ryoshi."
The co-founder and lead developer of Shiba Inu, who goes under the alias Shytoshi Kusama, also remains anonymous, refusing to reveal their name, age, or any other personal information.
Will Shiba Inu ever reach $1?
No, it's highly unlikely that the Shiba Inu coin will reach $1 anytime soon. For it to reach this mark, SHIB's market cap would first need to reach $589 trillion based on the current token supply. To put these numbers into perspective, the entire cryptocurrency market has a capitalization of just above one trillion at the time of writing.
According to Ryoshi, the anonymous creator of Shiba Inu, SHIB has “the ability to outpace the value of Dogecoin, exponentially, without ever crossing the $0.01 mark.” However, even this much more modest goal would require SHIB to reach a $5.8 trillion market cap — unless the SHIB community significantly ramps up their burn efforts to reduce the supply in circulation.
What is Shibarium?
Shibarium is Shiba Inu's newly released Ethereum Layer 2 blockchain and an integral part of Shiba Inu's ecosystem. It is expected to transform SHIB, a meme coin with little utility, into a value-added project with long-term prospects. Aside from bringing lower fees and higher throughput, Shibarium will also host a slew of ecosystem projects and dApps, such as SHIB The Metaverse, ShibaSwap DEX, and multiple blockchain games.