Since its launch in 2020, Shiba Inu (SHIB) has delivered astonishing returns to its early holders. The token once created a myth of wealth, but its glory days are long past. With its current price down 95% from its peak, its massive supply renders scarcity entirely out of the question, and it lags behind in payment and ecosystem applications while facing fierce competition. Although a meme coin frenzy may reappear, the odds of betting on Shiba Inu to recreate its former glory are extremely low given the thousands of similar tokens in existence.
Although Shiba Inu has generated massive returns in the past, its future outlook is not optimistic. As of June 30, its price had fallen 95% from its all-time high.
There are limited pathways for the token’s price to surge in the future. First, it would need to significantly increase its token burn rate. Over the past 30 days, only 112.4 million SHIB tokens have been burned, which annualized amounts to roughly 0.0002% of the total supply. Another obvious catalyst could be the launch of new features. If the layer-2 solution called Shibarium, the ShibaSwap decentralized exchange, Shib the Metaverse, or other innovations can genuinely deliver value to users, demand for the token may rise.
Of course, a meme coin frenzy could also occur again. As was the case in 2021, greedy market behavior could create a bubble in the cryptocurrency environment, with funds flowing into even the most unproven projects. If investors flock to these established crypto assets, Shiba Inu could emerge as a winner in such a scenario.
Shiba Inu bulls long for better days, but the outlook is bleak.
The token faces competition from all directions. Bitcoin’s total supply is capped at 21 million, and its scarcity is something Shiba Inu cannot match. When the supply stands at a staggering 589 trillion tokens, the use case as a store of value simply does not apply.
Payments could be another area to consider. But fast and inexpensive blockchains such as Solana and XRP are gaining attention from financial institutions, and Shiba Inu lags far behind in this regard. Stablecoins are also absorbing substantial amounts of capital.
As mentioned earlier, if the market ignites another meme coin craze, Shiba Inu could be set ablaze and take off. That might provide a boost. However, investors interested in such high-risk speculation now have many other options. Other well-known meme coins include Dogecoin, MemeCore, and Pepe, all of which could attract funds.
The Shiba Inu team may recognize that interest in meme coins fades quickly, and has therefore built a decentralized application ecosystem around it, including the ShibaSwap decentralized exchange, Shib the Metaverse, and the Shibarium layer-2 blockchain.
Cryptocurrencies that achieve long-term success typically have real-world utility or a unique source of value. But Shiba Inu does not.
It lacks the inherent scarcity that Bitcoin derives from its fixed 21 million supply. Shiba Inu has a maximum supply of 589.55 trillion SHIB tokens, so there is no scarcity whatsoever—which is one reason Bitcoin trades above $60,000 while Shiba Inu is worth only a fraction of a cent.
From a payments perspective, Shiba Inu is also unremarkable, unlike the role XRP plays in the Ripple payment network. Despite attempts to build an ecosystem, Shiba Inu is far behind the most successful blockchain networks in this area. Ultimately, it is little more than a Dogecoin imitator.
MemeCore has been extremely successful since its launch last year, indicating that crypto enthusiasts still have demand for meme coins. But with thousands of meme coins in existence, finding one that can skyrocket is nearly impossible. Investors would be better off sticking with more reliable investment choices, such as Bitcoin, Ethereum, and cryptocurrency stocks. To be clear, these assets can still be highly volatile, but they have a rational basis as investments.
