Bitcoin goes up over 6% and so do the rest of the coins. In cryptocurrencies, Bitcoin prices today were trading above the $51,000 mark as the world’s largest cryptocurrency by market capitalization surged over 6% to $51,101. Bitcoin, famed for its volatility, has shed more than $18,000 since hitting a record in early November, but it’s still up more than 75% this year (year-to-date or YTD) so far.
Meanwhile, Ether, the coin linked to Ethereum blockchain and the second-largest cryptocurrency, also surged over 4% to $4,114. On the other hand, Dogecoin prices rose more than 7% to $0.18 whereas Shiba Inu rallied nearly 15% to $0.000040.
Other digital tokens such as Cardano, Solana, Binance Coin, Stellar, Uniswap, Polkadot were also trading with decent gains over the last 24 hours. Meanwhile, the global crypto market cap rose over 5% to $2.52 trillion, as per CoinGecko.
Bitcoin, the most popular digital token had fallen about 30% over the past five weeks after setting a record high of almost $69,000 in early November. News that central banks around the globe are considering tighter monetary policy had weighed on risk appetite over the last few weeks.
In another news, The US Securities and Exchange Commission vetoed two proposals to offer bitcoin exchange-traded funds (ETFs), dealing a blow to market participants who had hoped the agency would green-light the effort after approving futures-backed bitcoin funds in October.
Too much speculation, not enough adoption
A big part of Shiba Inu’s problem is that too few businesses accept it as a currency. Just 388 merchants, mostly obscure, deem the token worthy of payment for goods and services globally. This lack of support is not surprising given the swings in Shiba Inu’s price, as it would be incredibly hard for a business to manage cash flow and profitability when the token’s value could drastically change day by day.
For that reason, the average consumer has no reason to buy or hold Shiba Inu except on the basis that someone will come along and pay more for their tokens later — otherwise known as speculation. That’s unfortunate for bullish investors because widespread adoption is the key to sustained price increases.
Take Dogecoin, for example. It had the same struggles with merchant uptake, and that token has never recovered from its 77% price collapse. However, just last week, Tesla Motors (NASDAQ: TSLA) CEO Elon Musk announced the company would begin accepting Dogecoin as payment for select items of merchandise. The token rallied 20% almost instantly on the news before shedding the gains, highlighting that adoption really can boost sentiment.
How many businesses and consumers would it take for Shiba Inu to reach $1?
Problems with supply
Bitcoin is the world’s leading cryptocurrency. There are 18.9 million Bitcoin tokens in circulation, so at the current price of $46,000, the total value of all Bitcoins is $870 billion. On several occasions, this total value has exceeded $1 trillion.
Here’s where Shiba Inu runs into an interesting problem. There are currently 589 trillion Shiba Inu tokens in circulation, so at a current price of $0.00003, they have a total value of $17 billion.
But what if Shiba Inu were to rise to $1? Don’t hold your breath waiting for that event. The math is pretty simple-multiplying $1 by 589 trillion tokens in supply means the total value would be an astronomical $589 trillion. From some perspective, all of the recorded wealth on Earth stands at about $431 trillion.
Imagine that every business and consumer on the planet adopted Shiba Inu while also converting all of their money and assets into Shiba Inu tokens. That all-in endorsement of Shiba Inu on a global scale would still only justify a price of $0.73 per token (to arrive at a $431 trillion total value). It feels crazy to even think about that as a possibility!
To put it quite simply, not only is it unlikely Shiba Inu ever reaches $1 per token, but by all reasonable accounts, it’s impossible. As a result, investors holding on in the hope of such a game-changing return from here have unfortunately set themselves up for disappointment.
Should you invest $1,000 in Shiba Inu right now?
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