The question of how popular meme coins Shiba Inu (SHIB) and Dogecoin (DOGE) will seek to outdo each other in the next bull run, if there is one, has no ready answers. But a few factors, including ecosystem development, could shed light on the direction they are both headed.
Let’s establish that the next crypto bull market is inevitable. Analytics firm Messari identified seven unique trends that could make this happen: apps, decentralized social trends, web3 gaming trends, new layer ones (L1s), Ethereum rollups, and others.
A lot of this development is already underway. And so is Shiba Inu’s, a dog-inspired token that was created to make up for what dogecoin lacked in functionality. Itself, DOGE started as a joke but has since acquired meme status thanks to billionaire Elon Musk’s backing.
After a massive rally last year, SHIB has crashed 87% since peaking at $0.000086 on Oct. 28, 2021, according to CoinGecko. While the token fell in line with the rest of the crypto markets, investors have also sobered up about their expectations of the asset.
Despite the decline, Shiba Inu remains the 14th largest cryptocurrency, with a market value of $6.11 billion. That compares with DOGE’s $7.98 billion, making it the tenth largest crypto asset. Dogecoin is down 92% from its all-time high of $0.7315 reached on May 8, 2021.
Shiba Inu was built on top of the Ethereum blockchain, making it compatible with that ecosystem. The idea was that its connection with the second largest crypto network would draw developers and users to SHIB.
What better way to do so than to send half of Shiba Inu’s initial supply of one quadrillion tokens to Ethereum co-founder Vitalik Buterin? Buterin immediately sold about $1 billion worth of SHIB and donated to India’s pandemic relief fund.
The rest, about 40%, he sent to a so-called “dead” wallet or burned them. The connection to Buterin helped Shiba Inu gain attention. However, SHIB has not grown at the scale that its pseudonymous creator Shytoshi Kusama hoped it would.
Burning is one strategy that the Shiba Inu ecosystem is utilizing to boost its token price – and gain an edge over dogecoin. More than 410 trillion SHIB have been burned to date, according to data from Shib Burn.
SHIB is destroying coins by sending them to a “dead” wallet, like what Buterin did. The burning is meant to reduce supply and increase demand, hoping that will boost SHIB’s price. With the asset’s massive supply, a lot of burning will have to take place.
By comparison, DOGE does not exercise burning – meaning that instead of capitalizing on scarcity, dogecoin’s supply is infinite. This makes the coin inflationary, something that has the potential to affect value negatively over time.
But the community does not see it this way. According to the dogecoin website, “dogecoin does not need coin burning marketing mechanisms that new tokens and other chains have attempted to implement to artificially inflate their prices.”
The SHIB edge
Mid-August, SHIB soared more than 42% in one day, only to lose all the gains by end of the month. However, the network is expected to launch the Shiba Eternity game on Oct. 6, a key bullish catalyst for the meme coin.
The game is part of major developments in the Shiba Inu network. Shibarium, a layer two (L2s) solution, is reportedly in the works to help boost functionality by making transactions cheaper.
Shiba Inu already operates a decentralized exchange (DEX), allowing users to transact peer-to-peer. The DEX is to be upgraded to ShibaSwap 2.0. Plans are afoot for a metaverse, part of a grand plan to bring on more users to support SHIB demand and drive up its price.
A decentralized exchange is yet to be made available on dogecoin.
“Although the two coins most likely will still flourish, my personal opinion puts SHIB ahead of the competition.” Yohannes Christian, the research analyst at crypto exchange Bitrue, told Be[In]Crypto.
“This is due to the root fundamentals of the token. While DOGE has its own mainnet, SHIB is built on Ethereum, and transaction speeds and cost will likely become more efficient in the future,” said Christian. He added that:
“SHIB tokenomics, which has a cap and is deflationary with the burn from its community and merchant partnership, made it a commodity. So its value will likely increase over time. At the same time, DOGE is an inflationary reward token to its miner, with around a 4% inflation rate per year.”
Christian said rumors of Shibarium and its metaverse that will have a burn tax mechanism up to 5% from transactions, should see “the SHIB price most likely have a bigger momentum in the next bull run.”
In crypto, whales are pretty crucial parts of the ecosystem. Therefore, holders and trackers are always on the lookout for the top whales in each cryptocurrency.
This nudge has given an advantage to dogecoin, which is highly favored by Tesla founder Elon Musk. The billionaire frequently expresses his support for the canine-inspired coin on Twitter.
Musk is believed to be a top whale in dogecoin, and has denied that he owns any SHIB, dealing a huge blow to the self-proclaimed dogecoin-killer. However, analysts say Musk’s tweets about dogecoin have minimal effects on DOGE’s market price.
Musk says even though dogecoin was created as a “silly joke, it is better suited for transactions” compared to bitcoin. Tesla has since started accepting DOGE for payment on some merchandise.
Ethereum whales love SHIB. According to WhaleStats, the top 100 Shiba Inu holders, minus exchange addresses and project wallets, also hold Ethereum (ETH). From the list of rich holders, about nine wallets own more than 1% of the outstanding supply of SHIB.
Altogether, the top 100 Shiba Inu whales own 20% of the total supply. On average, each wallet holds 1,955 billion SHIB, worth over $21 million. That’s a total of more than $2.1 billion. It seems there is no monopoly from any one whale. None owns over 10% of the circulating supply.
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