Can the Shiba Inu reach $1 by 2026?

Over very long periods of time, the stock market has placed itself on a pedestal above all other investment channels. While it may not outperform bond, gold or real estate returns every year, the stock market offers a much higher average annual return over the long term.

But in the short term, it’s a whole different story. Since the trough of the pandemic in March 2020, the cumulative value of all crypto-currencies jumped from $141 billion to nearly $1.9 trillion. That’s a gain of nearly 1,240%, for those of you keeping score at home.

While crypto’s “safe havens” Bitcoin and Ethereum rightly get a lot of credit for this large nominal increase in market value, it’s the meme currency Shiba Inu (SHIB 6.74% ) which has attracted many new investors to the crypto arena over the past 15 months.

Things couldn’t have gone better for Shiba Inu last year.

Last year Shiba Inu achieved what might be the best annual return we have ever seen. At the start of the year, a single SHIB token could be purchased for a mere $0.000000000073. If you are wondering why there are so many zeros after the decimal, remember that the initial coin supply was set at 1 quadrillion. See also: Investment tracker Delta adds NFT Explorer to its Web3 offering. Between midnight January 1, 2021 and October 27, 2021, when the tokens reached an all-time intraday high of $0.00008841, SHIB gained an incredible 121,000,000%! Even after a pullback at the end of last year, Shiba Inu have grown by around 46,000,000%.

Gains of this magnitude are virtually unheard of. Fortunately for Shiba Inu and its investors, a few factors worked in its favor.

For example, visibility increased dramatically in 2021. Many cryptocurrency exchanges agreed to list SHIB, which significantly improved its liquidity. Additionally, the decentralized exchange ShibaSwap launched in July, further increasing liquidity and allowing investors to stake their coins to earn passive income. Since staking became popular late last year, the median holding time for SHIB on leading cryptocurrency exchange Coinbase Global has increased from six days to 115 days, as of April 18, 2022.

Another reason Shiba Inu has been virtually unstoppable in 2021 is the dynamics of cryptocurrency trading. With shares listed in stock Exchange, it is relatively easy for pessimists to short a stock or buy a derivative, such as a put option. In the realm of cryptocurrencies, it is much more difficult for pessimists to bet against these assets. For example, some cryptocurrency exchanges do not allow short selling. Also, with the exception of bitcoin, there are no derivatives or futures for skeptics to buy. This created a natural buying bias that allowed social media-driven momentum to propel SHIB to the moon.

Could the Shiba Inu hit $1 in five years?

However, Shiba Inu devotees don’t believe their beloved piece is done climbing. Although it is nowhere near a penny, calls for SHIB to hit $1 per token persist on social media.

Based on the price per Shiba Inu piece of $0.00002515 at the time of writing, reaching $1 would represent an increase of almost 4,000,000%. Keep in mind that SHIB brought in more than 10 times that amount last year – so nothing is impossible. See the article: Polkadot Price Prediction April 2022: Will DOT Hit $50 in April? – feat. Crypto Academy.

But to hit $1 per token in five years (by 2026), Shiba Inu will need to flawlessly execute a series of upcoming projects, innovations, and enablers.

For example, the launch of the Shibarium tier 2 blockchain project should happen as soon as possible and work flawlessly once launched. Shiba Inu being an ERC-20 token built on the Ethereum blockchain, it is exposed to the same high transaction fees and slow processing times that sometimes plague the Ethereum network. Shibarium’s only goal is to drastically reduce transaction fees, in order to make Shiba Inu-based transactions more profitable and attractive.

If it is so important for the developers to launch Shibarium, it is because almost all future projects are based on low cost transactions. For example, the developers of Shiba Inu have never made a secret of their desire to launch games based on non-fungible tokens (NFTs) and sell digital plots of land, called “Shiba Lands”, in their own metaverse. However, NFT markets cannot take shape until the high fees associated with each transaction are reduced. Being an early and successful player in the NFT gaming space could help support a higher valuation.

Still, the biggest catalyst needed would probably be big “coin burn” events. Coin burning describes the process of sending tokens to dead blockchain addresses where they are no longer accessible. Just like the societyPublicly-listed companies are buying back their own common stock to increase the value of each remaining share, coin-burning attempts to do the same in the crypto space.

Adding zeros is the most likely outcome for the Shiba Inu by 2026.

Although Shiba Inu is sitting on a lot more projects and catalysts than he was this time last year, expecting everything to go smoothly doesn’t match the way the innovation works in the cryptocurrency arena. This may interest you: 3 Cryptocurrencies Hit Recent Highs: Is It Time to Buy?. I think Shiba Inu are more likely to gain, not take away, extra zeros after their decimal point by 2026.

Basically, a valuation of $1 per token without a massive coin burn event makes no sense. Based on an estimate of 549 trillion SHIBs still in circulation, a price of $1 per piece would give Shiba Inu a value ($549 trillion) that is more than five times the world’s gross domestic product. As an example, Apple is the largest publicly traded company in the United States, with a market capitalization of $2.7 trillion.

Another thing to consider is that Apple generated more than $112 billion in operating cash flow last year and is on the cutting edge of innovation. Meanwhile, Shiba Inu is nothing more than a payment coin that depends on the Ethereum blockchain. Worse, it’s not even a particularly useful payout coin. According to the online business directory Cryptwerk, only 659 mostly obscure merchants worldwide are willing to accept SHIB as payment.

As we have indicated, to reach 1 dollar, you would have to burn a huge amount of coins. However, this seems next to impossible given investors’ desire to hold on to their coins, as well as the aforementioned minimal use case for SHIB. Although some companies may burn a small percentage of coins with each transaction, the number of tokens sent to dead blockchain addresses is negligible compared to the estimated 549 trillion SHIBs still in circulation.

Another problem is that Shiba Inu fails to stand out in an increasingly crowded space. While the launch of NFT-based games may help, it’s worth pointing out that interest in NFTs has dropped significantly over the past two months.

Finally, history suggests that a massive price reversal awaits Shiba Inu – and it’s already underway. When I looked at the performance of other payment coins and protocol tokens on payment networks that made short-term, life-changing gains, I found that virtually all (bitcoin was the exception ) fell 93% or more within 26 months of their eventual highs. With SHIB gaining 121,000,000% in less than 10 months last year, current and potential investors should sound the alarm.

💎 Open an account for free to Invest in crypto!

CoinHouse allows you to easily invest in crypto-assets. Creating an account is free and takes just a few simple steps.

📈 Trade cryptos online in just a few clicks!

eToro allows you to trade cryptocurrency easily online. Creating an account is free and very simple.

68% of retail investor accounts lose money when trading CFDs with this provider. You should ask yourself if you can afford to take the high risk of losing your money. eToro users in France cannot open positions to buy real crypto assets, all orders are opened as CFDs.

The latest articles by Almmaye (see everything)

Leave a Comment