Despite being far below its peak, this meme token is drawing a lot of new investment.
The previous 14 months have seen a meteoric rise in the price of cryptocurrency assets following a turbulent 2022 that saw asset values plummet. It makes sense that some of the most speculative tokens are gaining given this positive environment.
Take a look at the dog-themed Shiba Inu meme token (SHIB 0.35%). Yes, it is still 64% below its October 2021 top price. However, as of March 13, the digital asset has increased by 238% in the previous month alone.
It’s possible that fans are looking for better times ahead given this strong momentum. Is Shiba Inu currently the best cryptocurrency to purchase?
Shiba Inu’s rapid ascension is paralleled by the surge of Dogecoin, its source of inspiration, which has more than doubled in the last month. In the same time frame, the value of PEPE, a more obscure token that is only a year old, has increased by an astounding 700%.
The phenomenal success of the recently launched spot Bitcoin exchange-traded funds (ETFs) is one aspect that may be stoking buyer excitement, even if it is tough to pinpoint the exact cause of these price increases. The entire asset class gains some legitimacy when these eagerly awaited financial vehicles receive regulatory certification. Perhaps investors are looking for additional approvals of cryptocurrency ETFs.
Shiba Inu’s price can rise quickly, which makes sense given that it is thought to be among the most speculative cryptocurrencies available. A positive feedback loop is created when early adopters benefit from the price increase by drawing additional attention to it. This momentum, until it abruptly ends, can be a very strong force.
Proceed with caution.
Shiba Inu is still much below its highest price, as previously mentioned. Risk-taking investors may find this setup to be very alluring. But I think purchasing this coin would be a mistake.
Theoretically, being constructed on top of the Ethereum blockchain should provide a great deal more functionality to decentralized apps, such as decentralized financial protocols and non-fungible coins. Shiba Inus haven’t exactly become very popular, though. Furthermore, there isn’t a large developer community advancing its usefulness. This is not encouraging for the future of Shiba Inus.
Put otherwise, the only reason to acquire this coin is the belief that its price will continue to rise in brief speculative bursts. Since the buy thesis is not supported by the asset’s fundamentals or by reason, this is what is known as gambling.
superior choices
Better solutions are available for investors wishing to dedicate a portion of their portfolio to the cryptocurrency market. Shiba Inu’s development on the Ethereum blockchain is indicative of the latter’s reputation in the field.
The first blockchain network to support smart contracts was Ethereum, a technology that will eventually open up considerably more use cases. With a larger development community and an extensive backlog of planned technical improvements, Ethereum is more likely to succeed in the long run than Shiba Inu.
Additionally, there is Bitcoin. Since 2023 began, the most valuable cryptocurrency in the world by market capitalization has increased by 330%. However, as more and more institutional capital pours into it, it might have more room to grow. Its decentralized structure and 21 million coin lifetime supply cap also make it seem like a modern-day store of value to many market players.
It is advisable to set Shiba Inu aside. It’s the meme token’s fifteen minutes of fame. However, it’s not a wise place to stash your hard-earned cash.
Is it the correct time to invest $1,000 in a Shiba Inu?
Think about this before purchasing Shiba Inu stock:
The Motley Fool Stock Advisor analyst team has determined the top ten stocks that investors should purchase right now. Shiba Inu was not among them. In the upcoming years, the ten equities that made the cut might yield enormous profits.
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