Dogecoin (DOGE) doppelganger Shiba Inu (SHIB) shot into the top 10 cryptos by market capitalization this week. The two are almost paw to paw in the crypto charts, although SHIB is currently ahead of DOGE.
Let’s dive into a comparison of the two cryptocurrencies and find out why they are all barking and not a bite.
Dogecoin vs. Shiba Inu
What Dogecoin and Shiba Inu have in common is that they are both based on the small bear-like breed of Japanese dogs. Both have communities of loyal fans supported by a culture of lighthearted memes and active social media channels.
Unfortunately, neither of them has much practical use. You can use both to pay for certain things, and Shiba Inu has a decentralized exchange called ShibaSwap (which is mostly useful for generating more SHIB-related tokens). But their lack of functionality hasn’t stopped them from taking the crypto world by storm. Each has a market cap similar to that of a large multinational company.
This is how they stack:
Dogecoin was originally started as a hoax to mock the way people invested in cryptocurrencies that they didn’t understand. To the surprise of many, the coin attracted quite a number of followers. New investors found the not-too-serious approach easier than other more serious cryptocurrencies, and the Dogecoin community thrived.
The founders resigned from the project in 2015 because they feared that Dogecoin had attracted too many unsavory characters. But the lack of leadership didn’t deter investors. Recently, in August, it re-established the Dogecoin Foundation, which has some heavyweights on the board, and set a strategic roadmap for the future.
It remains to be seen whether Dogecoin can successfully move into a serious project or whether an increasing mainstream will take some of its charm. But at least there is a chance Doge can take advantage of its incredible popularity and build a reputation for itself as a viable digital payment. Given its large market cap and the competitiveness of the digital payments market, this is still not necessarily a good investment. But it is a start.
About Shiba Inu
Shiba Inu uses much of the same language as Dogecoin, but it wasn’t designed for fun – it was created to ride and make money on Dogecoin’s success. Not only does it have an anonymous founder, which should be a red flag with any investment, but there are some things about the coin that just don’t sound like true.
For example, the project talks about wanting to help Shiba Inu rescue centers, but not a single cent of Shiba Inu’s activities goes to dogs in need. Instead, the Shiba Inu website simply encourages people to donate through Amazon Smile.
Similarly, the Shiba Inu whitepaper devotes a full page to Ethereum (ETH) founder Vitalik Buterin and his decision to donate $ 1 billion in SHIB to the Indian COVID Relief Fund. Shiba Inu presents Buterin as “Shib’s friend” and previously gave the crypto legend 50% of its tokens as a marketing gag.
But Buterin isn’t keen on these unsolicited coin gifts – he says he doesn’t want the responsibility. I can’t blame SHIB for trying to make the situation the best it can, but as an investment there are just too many things in their advertising that don’t quite fit together.
There are better investments
We’re in the middle of a pet coin craze and people buy anything with a Doge, Shiba, or Inu name in it. The success of Dogecoin and Shiba Inu means people are treating these coins as a kind of crypto lottery ticket. And considering how easy it is to create a coin and spin a dog-related story (with limited regulations to ensure the story is true), more Dogecoin knock-offs are flooding the cryptocurrency exchanges every day.
I understand why you might want to invest in cryptocurrencies like Shiba Inu and Dogecoin. The stories of enormous potential returns are extremely tempting. And sure enough people made money. But people make money in Las Vegas, and that doesn’t make gambling a good investment.
The problem is that when you invest in a cryptocurrency that has no fundamental use, you are just hoping that someone else will buy it from you for more. The price can go up, but it can just as easily go down for no reason – and if you buy to the high you will lose money.
Better bet? Instead of making short-term profits, look for coins that could build long-term wealth. Focus on cryptocurrencies that have a purpose and a management team that you trust. Take the time to understand what blockchain technology can do and weigh the pros and cons of crypto investing against other types of investments. The desire to make your money work for you by investing is laudable, and there are several lower-risk ways to achieve your goals.