Shiba Inu (SHIB), a Dogecoin spinoff that has rocketed to the center of attention in the financial world due to its outsized gains, is currently just a spitting distance away from its all-time high. Against this backdrop, social media is abuzz on the back of a speculative mania, with some predicting that the coin would soon hit the 1 cent ($0.01) price level. Let’s disassemble.
At the time of writing, Shiba Inu coins are trading at a $0.00002877 price level, which is just 17 percent below the May all-time highs of $0.00003389. Considering that the coin had lost over 80 percent of its value in the ensuing summer turmoil, the ongoing rally is astounding.
As a refresher, the Shiba Inu token is based on Ethereum’s ERC-20 protocol for smart contracts and utilizes a proof-of-stake (PoS) mechanism instead of one based on proof-of-work (PoW). This means that, unlike Dogecoin or Bitcoin, Shiba Inu can’t be mined. SHIB is the project’s foundational currency, and its supply is capped at 1 quadrillion coins. It should be noted here that Shiba Inu’s founder, colloquially known as Ryoshi, had donated 50 percent of this supply earlier this year to Ethereum’s co-founder Vitalik Buterin, who in turn sent over 410 trillion SHIB coins to a dead blockchain address, essentially taking them out of circulation. Currently, as per a tabulation by CoinGecko, only 497 trillion SHIB coins are in active circulation. Continuing with the refresher, LEASH is the project’s second token, and has a max supply of 107,646 coins. BONE, with a maximum supply of 250 million tokens, is the third coin under the Shiba Inu project. While LEASH can be purchased via Uniswap, a decentralized finance protocol that is used to exchange cryptocurrencies, BONE can only be obtained by staking SHIB coins on the project’s native crypto exchange, dubbed ShibaSwap.
Is It Possible for Shiba Inu’s SHIB Coin To Hit the 1 Cent Price?
We had noted in a previous post that Shiba Inu’s SHIB coin recorded over 27 million percent year-to-date gains as of the 05th of October. Of course, since then, the gains have increased to a whopping 39 million percent! If, however, the SHIB coin were to hit the 1 cent price level, it would need to add an additional 34,000 percent gain from the current levels. Given the quantum of gains that the coin has recorded so far this year, another 34,000 percent gain seems like a walk in the park. Alas, the reality is much more nuanced. Let’s take the conservative route and assume that the 497 trillion SHIB coins currently in circulation constitute its true supply. If the SHIB token then hits the $0.01 price level, it would constitute a market cap well over $4 trillion! Bear in mind that SHIB’s true supply is far higher than the nearly 500 trillion tokens currently in circulation. This means that, in reality, SHIB’s market cap would also be much higher than $4 trillion. For reference, Bitcoin (BTC) currently has a valuation that is just north of $1 trillion. For Shiba Inu to overtake Bitcoin, the project would have to demonstrate a fundamental utility that substantially exceeds that of Bitcoin – a difficult endeavor to assume even in the most lenient of circumstances.
Nonetheless, there is a sliver of hope for Shiba Inu bulls. As per a new post by Shytoshi Kusama, a Shiba Inu team member, the project is set to announce a series of supply burn triggers via the upcoming NFT drops. Specifically, 10,000 NFTs in the form of Wen Shiboshis are set to drop soon. Initially, these Shiboshis will only have generic names, for instance, 00001. However, the holders of these NFTs would be able to change their names for a $100 fee paid in SHIB coins. The caveat here is that these SHIB coins would then be burnt in a dedicated wallet. This means that whenever the name of any of the 10,000 Shiboshi NFTs is changed, $100 worth of SHIB coin would be burnt for each instance. At the current pricing, $100 is equivalent to 3.475 million SHIB coins. Of course, this amount is still a drop in the bucket. However, if the Shiba Inu project continues to unveil similar token burn schemes, eventually, a 1 cent price for the SHIB coin might not sound too far-fetched.
An SHIB whale just bought 6,178,758,122,373 $SHIB ($43,838,916 USD)
— WhaleStats.eth – top 1K ETH wallets (@WhaleStats) September 30, 2021
In the meantime, institutional interest in Shiba Inu continues to grow. Consider the fact that a “whale” investor had bought over 6 trillion SHIB coins toward the end of September. Moreover, the project also continues to benefit from the Elon Musk factor after the CEO of Tesla tweeted an image of Shiba Inu puppy on the 04th of October.
To conclude, yes, there is a slim chance that Shiba Inu’s SHIB coin might hit the 1 cent price level. However, the journey is likely to be arduous, and the probability of this eventuality is currently stacked against it.
The post As Shiba Inu (SHIB) Introduces a New Supply Burn Mechanism, the Widely Circulated Prediction for the Coin To Hit 1 Cent May Have Some Substance to It After All by Rohail Saleem appeared first on Wccftech.