Meme token Shiba Inu has been reaching “for the moon” with its price surging over 140 percent over the last week. The spike has made initial investors in the joke token billionaires.
One such holder, who had invested $8,000 in Shiba Inu in August last year is now worth a whopping $5.7 billion. “We may actually be looking at the greatest individual trade of all time,” the Morning Brew tweeted with a picture of the wallet of the user.
Several others who hold these alt coins have profited massively from their investments. Another twitter user claiming that they had invested $200 last year, showed off their gains — the valuation of their coins has touched $21 million.
Shiba Inu, the self-proclaimed ‘dogecoin killer’ may have succeeded in its ‘kill mission’ as it is ranked eighth based in terms of market capitalisation, comfortably ahead of Dogecoin, which is ranked tenth, according to Coinmarketcap.
If that doesn't make you sit up, Shiba Inu’s current valuation of $41 billion is more than the market cap of companies such as ITC, Larsen and Toubro (L&T), Maruti Suzuki, Nestle India and Adani Green Energy.
The record-breaking high comes after a Change.org petition urged crypto trading platform Robinhood to list Shiba Inu. “Let's encourage Robinhood to be the first traditional brokerage to get on this train!” the petition stated.
Shiba Inu has just been listed on Binance, and its momentum is growing by the hour. Half the questions on trading forums ask: “How can I buy Shiba???”
What is Shiba Inu?
Shiba Inu, which was created in August 2020 by an anonymous person who uses the moniker Ryoshi, is modelled on Dogecoin. The coin has been named after the Japanese dog breed, Shiba Inu. The alt coin’s logo is based on the Shiba pup.
The alt coin aims to be Dogecoin’s Ethereum-based counterpart. Ethereum is a community-run blockchain technology powering the cryptocurrency ether (ETH).
In September, Shiba Inu surged nearly 40 percent after US-based Coinbase said its customers can trade, send, receive, or store SHIB on its platform.
Shiba Inu started with a supply of 1 quadrillion but the founder had locked 50 percent in the cryptocurrency exchange Uniswap, then “burned” the other half to Ethereum co-founder Vitalik Buterin for safekeeping, according to the Shiba Inu website. Coin burning is a process used by cryptocurrency miners and developers to manage a coin’s price by restricting supply and incentivising long-term holding by users.
“The Shiba Inu token system supports innovative and artistic projects such as NFT art incubators. The development of its own decentralised exchange, called the ShibaSwap, is also in the pipeline. These are factors driving the token’s value and interest among traders,” said Nirmal Ranga, Chief Revenue Officer, ZebPay.
An NFT or non-fungible token, is a digital asset. NFT art is used by designers to categorise their digital artwork and monetise it.
“The surge in volumes that the token has been witnessing can also be attributed to FOMO (the Fear of Missing Out) — as interest peaks, traders rush to take part in the rally as a means to book profits,” he added.
Should you invest in it?
While the massive gains make Shiba Inu almost irresistible, it comes with extreme price volatility and risk. Unlike Bitcoin, which is hosted on its own blockchain and is aimed at creating a decentralised ecosystem providing maximum utility, altcoins like Shiba Inu can be hosted on the Ethereum blockchain and depend on community growth.
Alt coins, which are easier to create, and at a much lower cost than well-thought-out coins like Bitcoin, carry a high risk.
With its price less than $1, holdings in Shiba Inu
are expected to be concentrated in a few hands, making its price extremely volatile. For instance, if a few investors decide to dump the coin, the alt coin’s price may crash.