February 29, 2024
Crypto

Is Shiba Inu Still a Millionaire-Maker Crypto?


During the meme coin mania of 2020-21, Shiba Inu (SHIB -0.97%) captured the imagination of crypto investors by offering a potential path to millionaire status. And indeed, there are some crypto investors who did become incredibly wealthy by investing in the meme coin. But Shiba Inu is now down 90% since 2021, and a number of efforts to boost the token’s price over the past two years have not worked out as planned.

While things admittedly don’t look promising right now, there are still several possible scenarios for Shiba Inu to become a millionaire-maker crypto. I’m not saying these scenarios are likely, only that they represent possible paths to success. Let’s take a closer look, and then you can be the judge of just how probable they are.

Scenario #1: Reduce Shiba Inu’s coin supply

The first scenario involves Shiba Inu’s coin supply, which remains ridiculously large at 589 trillion coins. To put that number into perspective, the total lifetime supply of Bitcoin (CRYPTO: BTC) is capped at just 21 million coins. From my perspective, the only way to boost Shiba Inu’s price is by bringing the coin supply down to under 1 trillion coins.

The way to do that is via coin burning, which is simply the act of transferring a coin to a “dead” (i.e., non-functioning) crypto wallet. When you burn a coin, you remove it from the overall circulating coin supply, and that (theoretically) should help to boost the price of the cryptocurrency. With that in mind, Shiba Inu has launched a number of high-profile coin-burning campaigns.

But here’s the thing — even if Shiba Inu burns 1 trillion coins per year, it would still take 589 years to get the coin supply under 1 trillion! While there are some scenarios out there for how Shiba Inu could burn close to 10 trillion coins per month, there are enormous questions about just how sustainable that pace really is. Even if you did burn 10 trillion coins per month, it would still take five years to bring the coin supply down under 1 trillion.

Scenario #2: Boost demand for Shiba Inu tokens

The second scenario involves boosting demand for Shiba Inu tokens. And the way you do that is by boosting the overall utility of the Shiba Inu blockchain. Theoretically, the more ways you can use the Shiba Inu blockchain, the more demand there should be for Shiba Inu tokens.

Shiba Inu dog.

Image source: Getty Images.

The centerpiece of this strategy was the August 2023 launch of Shibarium, a Layer 2 scaling solution designed to improve the overall speed, efficiency, and throughput of the Shiba Inu blockchain. In many ways, Shibarium is similar to the popular Layer 2 blockchains now running on top of the Ethereum (CRYPTO: ETH) blockchain.

The question, though, is just how much new demand Shibarium will create for the Shiba Inu token. The launch of Shibarium was supposed to usher in a brave new world of blockchain gaming, decentralized finance (DeFi), and Web3 applications. Some even speculated that Shibarium might be used by large enterprises for their blockchain projects. While the number of transactions taking place on Shibarium seems to be surging in 2024, I’m taking a wait-and-see approach on this for now.

Scenario #3: Shiba Inu as the currency of AI

Finally, there’s the most unlikely scenario of them all: Shiba Inu becoming the currency for AI. Ever since the launch of ChatGPT, there has been growing debate over the possible intersection of AI and crypto. In one potential use case, autonomous AI agents would pay for data and computing resources with cryptocurrency. You can think of these autonomous agents as AI-powered bots that you trust with real money to carry out tasks throughout the day.

Right now, most people think Bitcoin will become the currency of AI. In fact, late last year, Ark Invest dedicated an entire 90-minute podcast to Bitcoin becoming the currency of AI. And, in January of this year, Palantir Technologies (NYSE: PLTR) co-founder Joe Lonsdale told CNBC that the three best candidates to become the currency of AI were Bitcoin, Ethereum, and Solana (CRYPTO: SOL).

But what if Shiba Inu becomes the currency of AI? As Elon Musk famously remarked, sometimes the most entertaining outcome is the most likely outcome. And what would be more entertaining than the iconic Shiba Inu dog becoming the mascot of AI? If dog-loving AI bots ever started to use Shiba Inu to pay for data and computing power, the price of the token might skyrocket.

The improbable math of becoming a millionaire

Certainly, the math behind becoming a Shiba Inu millionaire is alluring. Right now, for example, Shiba Inu trades for the super-low price of $0.000009. Thus, for just $10, you can buy over 1 million Shiba Inu tokens. If the token price goes to $1, you’re a millionaire.

But as we’ve seen with the scenarios above, the likelihood of Shiba Inu skyrocketing in value from $0.000009 to $1 is highly improbable, if not impossible. Remember — the all-time-high for Shiba Inu is just $0.00009, which is a little too close to zero for my liking. As a result, Shiba Inu is probably nothing more than a lottery ticket these days and should not be part of a long-term, buy-and-hold portfolio.



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