The total value of all cryptocurrencies in circulation reached a top of $ 3.9 billions in December, thanks to solid gains Bitcoin (BTC -2.10%))which constitutes more than half of this value in itself.
Bitcoin is one of the only major cryptocurrencies to recently set a new record – Ethereum,, Xrp,, MastiffAnd Shiba Inu (Salogner -2.34%)) are still below their best levels of several years ago.
Shiba Inu is one of the most interesting stories. It remains 81% below its peak compared to 2021, which is the year when it has delivered one of the best yields in the history of the financial markets. It climbed 45,278,000% between January 1 and December 31, 2024, which would have been sufficient to transform an investment of only $ 3 in more than a million dollars.
Shiba Inu is currently negotiated at $ 0.0000,15 per token, but could it stage another historic race and potentially reach $ 1? Read the rest to find out more about the obstacle of $ 589 billions on the way.
Shiba Inu failed the adoption test
Before diving into the problem of $ 589 billions, it is important to understand why Shiba Inu plunged 81% of its top of all time, while Bitcoin continues to define new records. The two cryptocurrencies are speculative assets, which means that they do not produce profits, so investors simply buy them hoping that someone will pay a higher price in the future. However, Bitcoin found a use case, unlike Shiba Inu.
An increasing number of investors Consider Bitcoin as a legitimate value storewhich was somewhat legitimized when the United States Commission of securities dozens approved Fund negotiated in exchange (ETF) Last year. It opened the door to allow financial advisers and institutional investors to buy Bitcoin in a safe and regulated manner, when they could have been restricted to have it previously due to the risks involved (digital wallets can be hacked).
It is unlikely that Shiba Inu will ever win investors’ confidence in the same way. In addition to her large volatility, Shiba Inu does not have his blockchain (It is based on the Ethereum Legacy network), and its developers always have a high level of influence on projects launched to help create value.
Therefore, even if Shiba Inu is technically Decentralized, it is not as decentralized as Bitcoin, which works on its own blockchain and operates independently of any person or community.
Shiba Inu has not been very lucky either as a currency. Only 943 companies around the world are ready to accept it as payment of goods and services (according to Cryptwerk). Many of them are obscure suppliers of Internet services and cryptography, and even online casinos. Becoming a largely adopted payment mechanism would be a means for Shiba Inu to create long-term sustainable value, but it may not be in cards due to the extreme volatility of the token.
The problem of $ 589 billions
The reason why Shiba Inu is negotiated at such a low price of $ 0.0000,15 per token is because of its enormous offer. There are 589.25 billions of tokens in circulation (against only 19.8 million bitcoin), so even at its current price, it always has a market capitalization $ 9.3 billion.
Simple mathematics dictate that a price per intercaut of $ 1, multiplied by its offer of 589.25 Billions of tokens, would give Shiba Inu a market capitalization of 589.25 billions of dollars. To give you an idea of ridicule, a report of UBS suggests that the total wealth held by each person, a company and government on earth was $ 454 billions of dollars in 2022.
This would also make Shiba Inu 34 times more precious than the combined market capitalization of “Magnificent seven“Technology giants, which are currently being $ 17.3 billions of dollars. In other words, there is absolutely no way that Shiba Inu can reach $ 1 in its current state.
However, the community tries to rectify the problem of supplying Shiba Inu by “burning“The tokens, which means to withdraw them from traffic. The easiest way to participate is to send tokens in a dead wallet where they can never be recovered, but progress has been slow so far.
Image source: Getty Images.
He could take 40,000 years to burn enough shiba inu tokens
As a rule, a cryptocurrency The price will increase in proportion to the number of tokens burned. Consequently, if the community has burned 99.999998% of all the Shiba Inu tokens in circulation to leave only 9.3 billion things to do (corresponding to the current market capitalization of Shiba Inu), this should theoretically train A price of $ 1 per token.
Burning 589.24 Billions of tokens would require the participation of almost all current investors, but it seems that most do not get involved. Only 1.2 billion tokens were burned in January, translating by an annualized rate of 14.4 billion. At this rate, it would take 40,919 years to burn all the tokens required!
But don’t forget that Burning Tokens creates no value. Even if you lived long enough to see that day, you would simply have 99.99998% less tokens that are at a price of $ 1 each, leaving your financial situation net exactly as before.
The only thing that will lead to the higher Shibiba Inu value is a case of legitimate use. Unfortunately, it does not appear about to find one, so investors should pay very attention to the continuation of its higher price if there is another speculative race.