Blockchain is seen by many as the innovation of the 21st century. The innovative solutions and ideas that arise from this technique are still in their infancy.
First there was Bitcoin (BTC), which today is considered a valuable store of value and a possible competitor to the old physical gold.
A few years later, Ethereum (ETH) came up with an entirely different use case for the blockchain, namely a smart contract platform that other development teams could build on. An entire ecosystem is currently developing around the Ethereum blockchain, including dynamic sectors such as DeFi and NFT.
However, smart contracts and DeFi do not seem to be the final stage of blockchain technology. A new use case has emerged that is revolutionizing the entire market: Shiba Inu.
Jokes aside, Shiba Inu has seen massive growth in the past few weeks and has even broken into the top 20 on CoinMarketCap. Currently, the memecoin is worth 11 billion dollars! That’s as much as AEGON or Mitsubishi Heavy Industries.
In real life, the Shiba Inu is a Japanese dog breed known from the “Doge” meme. Shiba Inu Coin does not take everything seriously either and positions itself as a “memecoin”. But is an 11 billion crypto project still a meme? Y What is the Shiba Inu coin?
Take a quick look:
Dogecoin vs. Shiba Inu
In 2013, a specific breed of dog became very popular out of nowhere. That was the year of the so-called Doge meme. This meme consisted of an image of a Shiba Inu surrounded by grammatically bad text in different colors. The meme became so popular that in late 2013 it became a cryptocurrency: Dogecoin (DOGE).
What no one expected at the time is that the Dogecoin cryptocurrency would become extremely popular and worth a lot. Since the beginning of 2021, Dogecoin has even attracted the attention of billionaire and Tesla owner Elon Musk.
Dogecoin’s success also attracted other developers. One of those projects is Shiba Inu, nicknamed: “DOGECOIN KILLER”
What is Shiba Inus?
“DOGECOIN KILLER” Sounds exciting, but what makes Shiba Inu better than Dogecoin?
Shiba Inu is an experiment in building decentralized communities. This community project concept is nothing new for the crypto world of 2021. Not too long ago we saw a lot of hype around SAFEMOON and other similar coins. All of these are also “community-driven” projects. The Shiba Inu founder had this to say about the project:
We are an experiment in spontaneous and decentralized community building
The word decentralization also appears several times in the Shiba Inu white paper. For example, the whitepaper captures the situation between Reddit, WallstreetBets, and GameStop earlier this year:
WallStreetBets tested the waters of what dispersing control would look like to inexperienced consumers and investors alike.
The white paper indicates that this situation was inspiring, but short-lived due to bureaucracy and a centralized society. Meanwhile, the Shiba Inu founders were busy with a “100% community-driven cryptocurrency experiment.”
In the context of decentralization, the Shiba Inu developers “burned” 50% of the tokens by sending them to Vitalik Buterin’s wallet. The white paper shows that the project assumes that Vitalik will not sell the coins.
However, today, May 13, 2021, the opposite turned out. Vitalik has sold 1 billion of his SHIB tokens, which is about 10% of his total SHIB portfolio, and then donated them to India’s Crypto Covid Relief Fund.
Second, it could be argued that the Shiba Inu is a more ambitious project than Dogecoin. The Shiba Inu ecosystem will not consist of one crypto currency, but three different crypto currencies: SHIB, LEASH, and BONE.
The observant reader has noticed the word “go” and therefore knows that this is not the current situation, and it is correct. For now, only the SHIB token and the LEASH token are available to buy and sell. The BONE token will launch at a later date, simultaneously with ShibaSwap, the decentralized exchange for the Shiba Inu experiment.
The goal of ShibaSwap is to be able to exchange tokens from the Shiba Inu ecosystem in a safe and decentralized way. Like Uniswap (UNI), ShibaSwab is a DEX.
Broadly speaking, ShibaSwap has 3 applications: DIG, BURY and SWAP. When SHIB token holders do one of these 3, they generate profits that are distributed to the “Puppy Pools”, where the army of SHIB holders have “buried” their tokens or are “digging up” BONES tokens.
This concept is similar to a liquidity or staking pool, but mainly uses fun names to appeal to a different audience that is interested in memecoins.
BURY, or “bury” is actually the staking mechanism of the Shiba Inu ecosystem. Where you can stake your coins with other proof-of-stake crypto currencies such as Ethereum, Polkadot (DOT) and Cardano (ADA), BURY them in Shiba Inu.
You can also place the various tokens in a liquidity pool in the future and thus provide liquidity to that trading pair. As a liquidity provider, you need not only the native tokens of the Shiba Inu ecosystem, but also ETH. In exchange for that liquidity, you get BONE tokens. These liquidity funds are called puppy funds.
The SHIB token is the first Shiba Inu project token and allows users to own billions or even trillions of them. Cryptocurrencies are very “cheap”. Actually, this is not really cheap, because if you look at how much a coin is worth, it is not about the price per crypto coin, but about the total market capitalization.
Calculate this market capitalization by multiplying the price per coin by the number of coins in circulation. That is also one of the reasons why Bitcoin is so “expensive” per coin: there are only 19 million Bitcoins in circulation.
On the contrary, the maximum number of SHIB tokens that will be in circulation is one quadrillion! Currently, there are “only” 400 billion SHIB tokens in circulation. Therefore, it is good to realize that the price per coin has nothing to do with the real value of a coin.
The SHIB token came out in August 2020 and has been booming ever since. The DOGECOIN KILLER nickname also comes from the fact that SHIB tokens can take over the market value of Dogecoin without touching a penny.
The MINUS token is the second token in the Shiba Inu ecosystem. The name Correa means “belt” in Dutch. Therefore, the intention of this token would be that its price is linked to the price of Dogecoin.
Later it was decided to convert the LEASH token into a simple ERC-20 token, just like SHIB.
Unlike the SHIB token, the LEASH token has a mega short supply of around 100,000 tokens. This makes the price per token much more “expensive” than the SHIB price per token, but the total market capitalization is much lower.
The third token in the Shiba Inu ecosystem is the BONE token and it is not tradable yet. The BONE token will be a governance token, which means you can vote with it. This way you can vote with the BONE tokens in the future which pairs of tokens will be included in ShibaSwap. The more BONE tokens you have, the more voting rights.
The GRRR List
The Shiba Inu ecosystem also has a so-called “Grrr list”. This listing prevents core exchange wallets from participating in staking mechanism rewards and liquidity pools. The only ones who can participate are private investors.
This fits well with the Shiba Inu vision, in which the project should be as decentralized as possible. A total of 250 million BONE tokens will be in circulation.
For the development of the Shiba Inu ecosystem, 5% of all BONE tokens will be distributed among the development team, amounting to 12.5 million tokens.
- 4,000,000 tokens will go to developers.
- 1,250,000 tokens will go to the moderators of the social media groups.
- 1,000,000 tokens go to marketing
- 6,250,000 tokens will be held to keep the momentum going once ShibaSwap is launched.
The roadmap, or as the white paper calls it, the “ruffmap,” remains secret in order to maintain a competitive advantage. Several applications are planned:
- ShibaSwap: Shiba Inu decentralized exchange
- Artist Incubator: An Apprenticeship Program to Help Artists
- NFT project
The Shiba Inu project cannot be described as very serious. Similar to Dogecoin, the project appears to be a prank gone wrong. However, there is definitely some development work behind the project. For example, the ecosystem consists of 3 different tokens and token holders can stake their tokens. In addition, a decentralized exchange of its own is emerging and a number of other developments are on the roadmap. We cannot say that on Dogecoin.
However, the value of the cryptocurrency seems to be mostly in the community. Social media and the internet ensure that literally everyone can learn about memecoins, including the Shiba Inu. A “community-driven cryptocurrency” is music to the ears of many young investors.
For more experienced traders, this is probably not the cryptocurrency you want to invest in. The crypto project does not have a clear goal in mind and is also based on a meme.
Finally, the Shiba Inu market cap is already so high that it is highly unlikely to go much higher in my opinion.
I hope you found the blog clear and pleasant to read. If you still have questions, we’d like to invite you to throw a ball in our AllesOverCrypto Facebook group. There, AOC’ers and group members are always ready to answer your questions. Then see you there!
Cover image by Seregraff/Shutterstock