Shiba Inu: its rise as a cryptocurrency, and its effects on DogeCoin.
There was a 30% increase in the last 24 hours, 100% in the past seven days, and 60,000,000% accumulated so far this year. Such has been the viral advance of Shiba Inu, the cryptocurrency that has achieved enormous popularity in the markets.
This cryptocurrency, like the others, is a currency created online, which means that it works and can be operated with it as with other virtual currencies, using an Exchange and saving it in our digital wallets or "Wallets", and like most cryptocurrencies, is based and created in a blockchain system that ensures the integrity of the tokens of this. But these "Meme Coins" have a big difference, and that is their purpose, which makes them behave peculiarly in the market, different from other cryptocurrencies.
As a currency, Shiba Inu does not respond to any need; it is not like Bitcoin, which was intended to revolutionize internet sales by introducing easy and anonymous payments and a currency for internet trading. Nor is it like many other currencies linked to a company or project and designed to work with several services or applications. Shiba Inu is simply a currency created for the sake of being made, it indeed has an ecosystem behind it, but as we will see later, its value is not influenced by it.
The token, launched last year, has a market value of more than US$33 billion, according to CoinGecko. It was trading Wednesday at US$0.00006827 (high), with a volume of 1.000 billion, 497 of which are in circulation.
The logo of this cryptocurrency, a Japanese Shiba Inu dog, is similar to that of another virtual currency -dogecoin- and easily recognizable as a meme used in social networks.
Both were created as a joke - the so-called "meme coin" or "altcoin" - which became severe and are now even easier to recognize after Shiba Inu made a handful of investors overnight millionaires. Today, however, is a fantastic day in the recent history of both cryptocurrencies, as for the first time, the value of Shiba Inu has surpassed that of dogecoin.
Growing interest on Wall Street and beyond
The meteoric rise of Shiba inu can be explained within the general boom of cryptocurrencies, in the context that the United States has not yet advanced in its regulation, as China has done, that large investors and entrepreneurs - among them George Soros and Elon Musk - have shown their interest, and that the first investment fund linked to cryptocurrencies - ProShares Bitcoin Strategy - has been created and listed on the New York Stock Exchange.
Bitcoin, the world's most valuable cryptocurrency, hit an all-time high of nearly US$67,000 per unit last week, surpassing the previous record set in April. Its price has soared 50% this month, from just under US$44,000 at the end of September.
In the case of Shiba Inu, earlier this year, Ethereum co-founder Vitalik Buterin made headlines for donating $1 billion of the cryptocurrency to a covid-19 relief fund in India.
The other side of the coin. The skepticism
However, there is also some skepticism even among experts in the cryptocurrency industry, in the growth of meme-based coins, as is the case of Shiba Inu. In this regard, Yi He, co-founder of the Binnance platform refers to meme cryptocurrencies such as dogecoin, shiba inu or the most recent one (which has turned out to be a scam) based on the Netflix series The Squid Game as risky currencies. He urges investors to proceed with caution and shows his reservations, "They started for fun, I don't think they have long-term viability."
Celebrities and the Shiba Inu cryptocurrency
On the other hand, Elon Musk is an excellent promoter of cryptocurrencies but has not yet focused on Shiba Inu. The cryptocurrency, born as a parody, cut part of its profits after the Tesla CEO pointed out on his Twitter account that he had only bought bitcoin, ethereum, and dogecoin.
Musk's tweets tend to move, in all directions, the volatile cryptocurrency markets, even generating anger and concern in the community of investors in these virtual currencies.
Musk's disinterest has not put off other celebrities. Nick Carter of the Backstreet Boys and NFL star Antonio Brown are among the Shiba Inu promoters.
"I think there's an incredible future for cryptocurrencies, especially knowing how they can be used for good and most importantly, to save lives," Carter recently told CNN, after learning of Vitalik Buterin's donation.
Carter identifies himself as a "cryptocurrency enthusiast and investor" and often tweets with #Shiba and #ShibArmy.
While Brown told CNN that "the Shiba Inu business is booming, and cryptocurrencies are the way to go, it's a new way to invest."
Robinhood enters the scene.
This week's dramatic rise in Shiba Inu coincides with a surge in support for a Change.org petition urging investment platform Robinhood to list the Shiba Inu currency on the site. The petition has gathered 334,500 signatures so far.
Robinhood began in 2018 to expand its cryptocurrency offerings beyond traditional bitcoin and ethereum; they include currencies like litecoin and bitcoin cash.
This year, dogecoin's record surge put so much pressure on the platform's cryptocurrency trading systems that it briefly went down. This week, it said cryptocurrencies accounted for nearly 20% of its transaction-based revenue in the third quarter, or about $51 million. That's an 860% increase over the same period last year.
Shiba Inu: Speculation pure and simple
Investing and trading in these currencies is easy and quick, although there are some risks that it is a good idea to consider before you start buying. The process works similarly to standard currencies: you go to a place where they exchange the cash you have with the one you want to get (known as "Exchanges"), and there you make the operation. The only detail is that you will need to have a place to store the coins, just like you need a bank account or a wallet to put your real coins. Wallets" are used to store these virtual currencies, which can come in different formats, as physical ones in USB stick format or as virtual ones in some platform or your own computer. In most cases, the Exchanges themselves will offer us a virtual wallet to use.
Coins like Shiba that have been created to make a joke can be funny and see the whole picture, and speculation that forms around them can be more or less funny, but in the end, investing is not child's play. Cryptocurrencies are not a source of unrestricted income, at least not without having done trading courses or knowing how similar systems work, as can be the stock market or the different stock markets.
So if we want to invest, the best thing to do is to be adequately informed and trained. If we wish to buy some of these coins no matter what happens in the future, it should always be leftover money. So we do not miss, because who knows, just as in a few years we may find that the currency has made us millionaires we may also find that it has disappeared and with it the money that we had put.