What Is Shiba Inu and How Does It Work?
What Is Shiba Inu Coin?
Shiba Inu is an altcoin that is Ethereum-based. The cryptocurrency uses the Shiba Inu hunting dog as its mascot. It has been highly regarded as an alternative to Dogecoin, with some proponents terming it as “the Dogecoin killer.”
The coin was created in August 2020, almost seven years since the launch of Dogecoin in December 2013. Shiba Inu creator is an anonymous group or individual Ryoshi. The crypto, together with Dogecoin, is meme coins. These cryptos are associated with a theme, in our case Shiba Inu dog, and often start as a joke or parody rather than an asset with utility.
History of Shiba Inu
So, what is the Shiba Inu coin history? Shiba Inu coin origin dates back to August 2020. The cryptocurrency was created with an initial supply of quadrillion tokens. The altcoin’s first and most notable move was when its founder sent half of its supply to ETH’s co-founder Vitalik Buterin in May 2021.
Vitalik Buterik donated 10% of the token and burned the rest. As a result, Shiba Inu has 549 trillion tokens today. In July 2021, the altcoin launched Shibaswap, its decentralized exchange. Later, Nover Shiba Inu joined hands with David Folk to come up with a cryptocurrency gaming project.
How Does Shiba Inu Works?
The cryptocurrency functions on a decentralized computer network that runs on the Shiba Inu database called a blockchain. The Shiba Inu blockchain manages and tracks the cryptocurrency and verifies and records every Shiba Inu transaction.
Therefore, the database is a long-term record of the activities of the cryptocurrency. The Shiba Inu crypto runs on the Ethereum blockchain for safety and functionality. Currently, the coin trades for a fraction of a penny. You will need several hundreds of the coins to reach a cent.
However, since there are 549 trillion coins in circulation, the total value of the coins is in the billions. The coin’s value was at an all-time high when it was added to the Coinbase exchange in September 2021.
The Shiba Inu Coin Eco System
The success of any cryptocurrency does not come just like that. All cryptocurrencies need an ecosystem and the right team to function optimally. An ecosystem is a group of elements that can interact with each other and the world to create the desired environment with unique features. Below are the tokens that constitute the Shiba Inu coin ecosystem.
This is the foundational currency of the project. It started with a total supply of one quadrillion coins. The founder locked 50% of the coins in Uniswap for liquidity. He sent the rest to the co-founder of Ethereum, Vitalik Buterin.
Buterin went on to donate 50 trillion coins worth $1 billion at that time. He then burned 40% of the total coins/ removed them from circulation to a dead wallet.
The Leash Shiba Inu coin or Shiba Leash token is the second token in the ecosystem of Shiba Inu. The leash part of the ecosystem represents the other end of the spectrum. Leash has a total of 107,646 tokens in supply. This is a small percentage compared to the trillions of Shiba Inu tokens.
The Shiba Inu bone token fits between the two tokens discussed above in circulation supply. It has a total of 250,000 tokens. The bone token has been created to be a governance token. This means that the users of Shiba Inu or the SHIBArmy will use the tokens to vote.
ShibaSwap decentralized exchange serves the purpose of providing a place that is safe to trade the Shiba Inu crypto currency while at the same time being decentralized. The Shiba Inu token and the Leash token are best traded through ShibaSwap.
Shiba Inu Incubator
The Shiba Inu incubator was created to discover ways to honor ingenuity and creativity. The token achieves this by shifting the focus from popular art forms such as photography, painting, and digital rendering. It aims to explore other untapped areas of creativity.
Shiboshis are Shiba Inu-generated non-fungible tokens. A Shiboshi NFT is written on the Ethereum blockchain, and there are currently 10,000 non-fungible tokens that are Shiba Inu generated. Each Shiboshi is written with different traits, and therefore each is unique and collectible.
Uses of Shiba Inu
The Shiba Inu was created to become a digital currency. Since then, the cryptocurrency has launched a decentralized exchange to create the Shiba Inu ecosystem. Below are some of the uses of cryptocurrency.
Shiba Inu coin payment is a peer-to-peer payment method accepted by businesses. Shib accepted as payment does not offer any competitive advantage over other notable cryptocurrencies. This is because Shiba Inu not accepted as payment method. At the beginning of 2022, 600 businesses accepted Shiba Inu. This number is small compared to 7,500 businesses that accepted Bitcoin.
Decentralized Cryptocurrency Exchange
In July 2021, the Shiba Inu decentralized crypto exchange was launched. It offers to trade between tokens built on the Ethereum blockchain or ERC-20 tokens. This was a DEX exchange and was dubbed the ShibaSwap. DEXs are part of a decentralized system (DeFi). The system allows crypto traders to swap from one crypto to another without providing personal information or registering an account directly from their blockchain wallets.
The ShibaSwap marketplace offers Shiba Inu NFT for non-fungible tokens. Each ShibaSwap NFT is called a Shiboshi. These are cartoons of Shiba Inu dogs that are pixelated, each having unique characteristics. Additionally, the Shiba Inu team is coming up with a Shiboshi game that will have these characters.
Pros and Cons of Shiba Inu Coin
Like all other cryptocurrencies, the Shiba Inu coin has pros and cons. Below are some of its advantages and disadvantages:
Pros of Shiba Inu
- Investors of Shiba Inu can get rewards through staking with all three tokens being staked. Staking involves locking up your crypto in an exchange or wallet, validating transactions, and earning rewards.
- The coin offers the potential of a rise in price and the generation of profits from the hike.
- Shiba Inu liquidity pool is high, and the coin is therefore easy to use.
Cons of Shiba Inu
- Shiba Inu coin volume is high, resulting in Shiba Inu low price.
- Shiba Inu is not accepted as payment. Only very few vendors accept the coin as a form of payment.
- Shiba Inu Volatile. Like other cryptocurrencies, Shiba Inu is a highly volatile cryptocurrency.
- Shiba Inu is not considered innovative.
Why Should You Invest in Shiba Inu?
So, should you buy Shiba Inu coin? The coin has experienced a significant fall in value that seems quite mysterious despite the volatility of cryptocurrencies. All things considered, a Shiba Inu investment may not be very profitable. You may invest a little for fun and mere speculation, but heavy investment is not advisable since the coin has very little value.
Shiba Inu has had some exciting developments lately that indicate that the currency might be bouncing back. However, it would help to note that buying Shiba Inu is a risky investment. Still, the cryptocurrency does not provide much utility in the real world.
Also, the currency does not have unique functionalities that set it apart from others. Despite its use as a mode of payment, other notable cryptocurrencies are accepted widely. Therefore, the coin has to develop a competitive advantage over other coins such as Bitcoin to survive in the market. With that said, do not invest what you cannot afford to lose.