The hype around cryptocurrencies (or crypto) is continuing to grab the attention of the masses, and interest in investing is continuing to grow. New currencies are constantly popping up – and popping off. Over the past few months, you may have seen this happen with something called Shiba Inu.
The coin variety exploded onto the scene a few months back, and in recent days has made headlines again for its value surge. If you’re wondering what Shiba Inu is, however, and why you keep seeing the same dog breed appearing on all your social media feeds, we’re here to help.
We reached out to the investors behind NZ-based finance podcast Girls That Invest, Simran Kaur and Sonya Gupthan, at the height of Shiba Inu’s first popularity spike for a little insight into why Shiba Inu is gaining so much attention
Kaur shared her thoughts with me over email.
You can thank other meme coins for the hype
If you’re familiar with Dogecoin, and the craze that followed its spike in value a little while back, you’ll know just how big meme coins can become. Shiba Inu first got some attention off the back of that.
Kaur shared that “Shiba Inu is an ethereal based ERC-20 cryptocurrency token” and explained that at the time of its initial surge of interest it had “been riding the hype surrounding cryptocurrencies”.
She explained that “very little is known about Shiba Inu”, and that the coin is one “with no intrinsic value that relies on popularity to rise in value. Unlike cryptocurrencies like Bitcoin or Ethereal, Shiba Inu wasn’t created to provide a real-world benefit but rather is part of the ever-growing hype of meme coins.”
In essence, she shared that folks were keen to find “the next big thing in the crypto world”. This is why so many looked to SHIB immediately after the Dogecoin spike.
“Some investors believe[d] due to the similarities between Shiba Inu and Dogecoin, in that they both feature the same animal [the Shiba Inu dog], Shiba Inu could possibly follow in Doge’s footsteps.”
The interest and excitement only intensified once the coin was made available for purchase on popular crypto exchange services.
“Binance, one of the largest crypto exchanges where retail investors can buy and sell cryptocurrency, announced on May the 10th that Shiba would be available to purchase from their platform, thus feeding further hype from investors,” Kaur said.
Some time has passed since then, and as Yahoo Finance reports, the coin saw some value increase more recently. On Saturday, October 23, Shiba Inu experiences a 21.28% jump. At its peak, Bloomberg reports the coin reached the 11th biggest cryptocurrency in terms of market value.
Okay, so what’s the deal with investing in Shiba Inu?
The general advice Kaur gave on this is that you should seriously consider all the risks before investing. That goes for any high-risk cryptocurrency (or investment in general).
She explained that after Dogecoin’s value jump, “many animal-based meme coins have been rallying” with the hope of becoming the next Doge. She stressed, however, that there is no way of determining what the next Dogecoin will be, or if they ever will be one,” she said.
Kaur added that a few months back, Binance announced it believed Shiba Inu “poses a higher risk than normal, which is saying a lot as cryptocurrencies are already quite high risk. Please exercise sufficient risk management, do your due diligence in regards to the token’s fundamentals and understand what you are investing in before investing in any cryptocurrency.”
Coinstash co-founder Ting Wang added that, while it’s tempting to jump on board when cryptocurrencies see loads of hype, there is a lot to consider.
Over email, he explained that:
“When trading Shiba, beware that it can be extremely volatile, and make sure you consider factors such as liquidity as well [how easily it can be converted into money or other cryptocurrencies].”
So, long story short. Don’t put your money into anything you haven’t thoroughly researched first.
Oh, and if you’ve decided to invest in any crypto over the past year (or earlier, even) it’s worth doing some research to ensure you’re approaching tax time correctly. Read our guide on that here.
This article has been updated since publishing.