Shiba Inu (SHIB) is one of the most popular cryptocurrencies released in late 2020. Shiba Inu was created around a Japanese dog breed called Shiba Inu. Shiba Inu founders launched the coin and tagged it “the Dogecoin killer.”
However, what started as a meme coin has risen to become one of the top 20 coins in crypto. Its growth has garnered the attention of several investors and is often considered a coin with high profitability potential.
But, meme coins usually have high volatility because they are often seen as a joke. So, with the idea surrounding Shiba Inu as a meme coin, is Shiba Inu a good investment option right now?
This article will explain factors that speak against and for investing in Shiba Inu.
Shiba Inu Investing: Is it Safe?
The safety of a crypto coin is strongly based on its foundation, structure, and utility. Shiba Inu is a community-driven altcoin. This means its growth is largely dependent on the growth of the community.
Crypto investors consider utility as a strong focus before investing in cryptocurrencies. But for Shiba Inu, the focus is more on the community’s strength than on SHIB’s utility. More importantly, because it’s a meme coin, its community must be positive about the future potential for its long-term performance.
Shiba Inu’s white paper described SHIB as an “experiment” for building decentralized communities. Since its inception, Shiba Inu has performed well in the crypto market and is embraced by many investors because of its strong community.
If you invest in Shiba Inu, the safety of your investment is based on how SHIB performs. Like many other cryptocurrencies, SHIB is a volatile asset whose price fluctuates rapidly. And it’s hard to predict the market’s moves, making your investment potential more speculative.
Shiba Inu’s Past Performance
The table below shows the price of SHIB on September 7, 2020, and 2021. The percent change in SHIB covers from the beginning of each year.
|Year of Investment||Price of SHIB||% Change in SHIB Price|
Shiba Inu is a relatively recent cryptocurrency compared to Bitcoin. Bitcoin was created 13 years ago in 2009, while Shiba Inu was launched 3 years ago, in August 2020. It’s just 3 years old and has quickly risen to overtake other decade-old cryptocurrencies.
If you bought $1000 worth of Shiba Inu on September 7, 2020, as of September 7, 2022, you would have a huge sum of $98,870,970. That’s a thousand-dollar investment turning into almost a hundred million dollars in two years. If you sold off when SHIB hit its all-time high of $0.00008616 on October 18, 2021, you would have made $694,838,700.
From September 7, 2021, to September 7, 2022, SHIB has gained more than a hundred percent. If you invested $1000 at the time, you would have about $2000 now.
Although SHIB is a fairly new cryptocurrency, its annual yields have never fallen into a negative region. But is SHIB a good investment right now?
Is it a Good Idea to Invest in Shiba Inu?
Investing in a meme coin can be tricky. Many factors affect the potential profitability of SHIB. Some factors are positive, while others are not so much. The next section will give insights into the pros and cons of investing in Shiba Inu. At the end of this article, you can make an informed investment decision. So, is Shiba Inu a good investment in 2022? Let’s find out.
What Speaks Against Investing in Shiba Inu?
Its Popularity is Based on Hype
Hype can be a good thing for temporarily scaling the demand for an asset. But hype is a difficult factor to rely on for the future performance of a coin. Many investors are buying into Shiba Inu because of the fear of missing out. As an investor, you need to find solid reasons to invest in a coin rather than the surrounding hype.
High Risk-Reward Profile
Shiba Inu is a very risky meme coin to invest in. Compared to Bitcoin and Ethereum, Shiba Inu has greater risks than the return on investment, especially for long-term investors. Short-term investors and crypto traders can benefit more from SHIB than investors looking for long-term performance.
Shiba Inu is down 85% from its all-time high in October 2021. SHIB is also a relatively novel cryptocurrency, and there’s not enough data to predict its future performance closely. Although the overall crypto market influences the volatility of SHIB, many investors are skeptical about if SHIB is worth its price.
One-person: Huge Market Share
There’s about a supply of 549 trillion Shiba Inu coins in circulation. But an anonymous person bought 70 trillion SHIB tokens in August 2021 for $8,000. The mysterious individual behind the purchase has 12.75% of the entire Shiba Inu market.
Many investors are concerned that the anonymous billionaire might sell their assets sometime soon, and this could cause a major sell-off in the market. The last thing any investor wants to see is a fast and deep dump in an asset’s price. And this event is not impossible in the Shiba Inu market right now.
In the last six months, Shiba Inu has failed to gain momentum to make it a very attractive investment. It has been on a slow decline, and although it has a strong community, many are projecting that the Shiba Inu era is ending. With SHIB struggling to project itself as a cryptocurrency with an intrinsic value, it might not be a reliable investment in the long term.
What Factors Make Shiba an Attractive Investment?
The first factor to consider when considering if a cryptocurrency is a worthy investment is its value. Shiba Inu started as a meme coin with no utility whatsoever, but a lot has happened since then. For starters, Shiba Inu is now being used for payments. A Baltimore Porche dealership started accepting SHIB for payment for its cars in 2022.
Shiba Inu has a strong community, the Doggy DAO. DAOs are decentralized autonomous organizations or member-governed organizations with no central authority. Decisions are not monopolized; instead, all members of the DAO vote to make the best decision for the community.
Members of the Doggy DAO get governance tokens called the BONE. The BONE is awarded to the participants of the DAO. Shiba Inu also has another token called the LEASH, which is an independent token but originally used to track the price of dogecoin and is known as the “dogecoin killer.”
Shiba Inu has a lot going on, including a rescue campaign for Shiba Inu dog breeds. They have a non-governmental organization called the Shiba Inu Rescue Association. All users have to do is to use smile.amazon.com, select Shiba Inu as their preferred NGO, and a percentage of their purchases will be donated to rescue Shiba Inu dogs.
ShibaSwap is an excellent feature, initially a plan in the roadmap of Shiba Inu. Now, ShibaSwap is fully functional and is scaling the use of SHIB. It is a decentralized crypto exchange which works similarly to Uniswap.
No intermediaries are needed to approve or confirm your transactions; you’re fully in charge. ShibaSwap rewards users who participate in liquidity pools, and this can help boost its performance eventually.
Good Profitability Potential
If you invested in SHIB in 2021, you’d have gotten almost a million percent increase as of September 7, 2022. That’s a very crazy amount and is one of the reasons many are jumping in on investing in Shiba Inu. If you invested last year on September 7, you’d have made a hundred percent a year later.
However, if you had invested in Shiba Inu at the beginning of the year when it was $0.000034, you’d have lost 64% of your investment as of September 7, 2022. But, the market is generally in a bear season, and SHIB can still be profitable over time.
Pros and Cons of Investing in Shiba Inu
|SHIB has a growing utility as a payment system for real-world assets.||Shiba Inu’s popularity is based on hype.|
|It has one of the strongest DAO and online communities.||A single individual owns 12 .75% of the circulating supply in the market.|
|Its defi applications and exchange increase its use globally.||It has a high-risk-reward profile, especially because it’s a meme coin.|
|Its first two years yielded excellent returns.||It has lost 65% since the beginning of 2022, and there’s increased skepticism about the coin’s future.|
Different Ways Of Investing in Shiba Inu
If you’re convinced that Shiba Inu is a worthy investment, there are different ways to earn from the market.
Buy and Hold
SHIB is at its lowest since the beginning of the year and can be a good buy entry right now. However, there’s no strong pointer to how well Shiba Inu could perform in the following years. Based on its first two years, it gave an excellent annual yield, but its growth is not impressive so far. Buying and holding SHIB for the long term might not be a reliable investment.
Although the long-term strategy might not be the best for SHIB, you can earn good profits from trading Shiba Inu. Shiba Inu is volatile, and its price changes quickly, especially with a new headline or influencer tweet. You can make tons of money if you know how to leverage such occasions for spot and futures trading.
But even without any significant news or tweet going viral, you can still trade SHIB on the crypto exchange. You can execute a short-term buy-and-hold investment strategy where you buy when the prices are low and sell when they rise. You can also add leverage in derivatives trading, like perpetual futures, to multiply your profits. But you should remember that the market is unpredictable and only invest what you can afford to lose.
How Much Should You Invest in Shiba Inu?
You should invest in SHIB only if you’re a risk-averse individual. While it’s sometimes necessary to take risks, especially when you believe in the future of an asset, ensure you understand your risk appetite. Invest only an amount you’re willing to let go of if you choose to invest.
It’s advisable to put in only small amounts, as SHIB is just 3 years old in the crypto market. A lot can go wrong, and it could boom in the years to come. Financial planning experts say 1-5% is enough to allocate to crypto assets, so the key here is to start small.
Expert Predictions on Shiba Inu
Many crypto experts don’t believe SHIB will finish the year strong. And some predict it will.be worth next to nothing in the next ten years. David Hsiao, the CEO of Block Journal, points out that the success of SHIB is because of its onset association with dogecoin and is driven by hype.
Matthew Henry, director of funds at DigitalX Asset Management, predicts SHIB falling by the end of the year. According to Matthew, stronger plays are crypto coins with much-attached value and quality than hype.
The major doubt investors have about SHIB is its intrinsic value and what it offers in terms of innovation in blockchain or finance. Hype dies over time, but the value is a solid factor that sustains an investment. However, crypto analysts project that SHIB could reach $0.0003 by the end of 2022.
So, is SHIB a good investment right now? Maybe; maybe not. It’s hard to predict how the year will end, and SHIB is already down 65% since the beginning of the year. Most crypto investors want SHIB to have proper utility before considering it for long-term investment.
Currently, SHIB is being accepted as a payment system, and if the utility and demand growth in the following months, more investors can be compelled to invest in Shiba Inu.