Shiba Inu gained some attraction as we near Valentine's Day, and we'll shortly explain why. Shiba Inu was launched in 2020 by an anonymous developer nicknamed 'Ryoshi'.
In September 2020, 1 Shiba Inu was worth $0.0000000003. At its peak in October 2021, 1 Shiba Inu was worth $0.00008000 (approx.). In terms of Return on Investment (ROI), investors that purchased the cryptocurrency in September 2020 achieved +2,600% ROI.
Shiba Inu's popularity is greatly due to the outstanding rally it posted in the market. After peaking at $0.00008000 it was followed by profit realizations. Due to its low price, many see the coin as a 'fast investment'.
It is merely part of the hunt for the next bitcoin .
There were several contributing factors in 2021 to Shiba Inu's rally. What also fueled the rally in 2021 were speculations that Shiba Inu will be listed in Robinhood. A coin listing tends to have a positive impact as seen in similar tokens.
Elon Musk's tweet of Shiba Inu 'going to the moon' made headlines in the crypto markets.
However, when Elon Musk was asked in a tweet how much SHIB he is holding he replied: "None."
Musk's reply marked the collapse of Shiba Inu, the coin was unable to recover until very recently when some gains are taking place at the time of writing.
Shiba Inu Is 'Burning'
Bigger Entertainment (biggerenterainment.com), a crypto entertainment brand announced it will burn 163 million Shiba Inu tokens on 14 February 2022 (Valentine's Day).
One of the greatest SHIB burns were by Ether network developer, Vitalik Buterin who burned 410 trillion SHIB tokens, estimated to be worth billions of dollars. The developer said he did not wish to have so much power. Burning a cryptocurrency is done by sending the coins to a 'dead address.' This ensures that the cryptocurrencies are taken out of circulation.
The address is still being used to burn cryptocurrencies including Shiba Inu. Ethexporer shows a spike in the transfers made to the burn address.
source: ethexplorer
source: ethexplorer
When a large amount of cryptocurrencies are destroyed (in the above manner) it tends to strengthen the cryptocurrency. The CEO of Bigger Entertainment, Steven Cooper tweeted on Sunday: "If we sell 1,200 more tickets, this becomes the largest burn party we’ve had yet. If you haven’t pitched in yet, get your tickets today. All #shib will be burned live on YouTube on 14th February at 2pm CST. We can do this :).”
Additionally, Bigger Entertainment launched several games with the sole intention of burning Shiba Inu coins.
In addition to the 'mass burning festival', Unification announced that it is planning a layer 2 blockchain for Shiba Inu. At the time of writing, SHIB does not have its own blockchain. It is based on ETH blockchain (layer 1), and layer 2 will be built on the parent blockchain.
The public testing is due 'very soon' according to a blog post on Unification's official website.
Should You Buy Shiba Inu?
While the fundamentals are currently weak, the recent gains have attracted some attention. According to whalestats, Shiba Inu holdings have increased among the top 1000 ETH accounts.
source: whatestats
If ShibArmy succeeds in rekindling interest in SHIB, we may see stronger gains in the market. The cryptocurrency is cheap and has over 1,000,000 account holders at the time of this writing.
One of the possible bullish drives is that Shiba Inu may be used for buying virtual land in a new metaverse platform. MANA (decenterland) and AXS (Axie Infinity) are worth a substantial amount of money.
If the developers succeed in building a new metaverse (dubbed 'Shiberse') and gain large interest from the market it may be a stepping stone towards firmer gains in the cryptocurrency. A lot of faith may be required at this stage to invest in Shiba Inu, but many market participants see Shiba Inu as a bargain due to its low market price.
Should You Sell Shiba Inu?
It is a meme coin that enjoyed a moderate rally due to Elon Musk. Without Elon Musk, it is challenging to determine whether Shiba Inu would have posted strong gains in 2021.
One of the risks is if the coin will succeed in extending its gains, which is a similar reaction to what took place in BRDUSD.
Large investors may use the rally to dump their holdings and may result in fast-paced retracement. BRD initially spiked higher, lured fresh investors in and then tanked lower. Similar techniques are also used in NFTs to inflate the price of the project.
The technical analysis for Shiba Inu is neutral at the time of writing. If the price manages to break above 0.00004000, the rally may continue. Aside from the recent 'burnout' gains, the technical stance for the medium-term may be neutral.
