Shiba Inu has put the investors in muddle some situations. But for as good as Shiba Inu has been in 2021, the hottest cryptocurrency in the world looks to be losing its luster. Between an Oct. 27 peak of $0.00008841 and an intra-day swoon on Nov. 24 to $0.00003614, SHIB has lost as much as 59% of its value in four weeks. Despite delivering historic gains, the question has to be asked: How long can Shiba Inu go?
One of the biggest knocks against this popular digital currency is that it lacks anything that resembles a competitive edge. While Shiba Inu is abuzz on social media message boards, there’s nothing unique that makes it a long-term winner. Since it’s an ERC-20 token built on Ethereum’s blockchain, it’s tethered to the same high transaction fees and processing lags that occasionally accompany the Ethereum network.
To build on this point, the real-world utilization for Shiba Inu is particularly low. Recent updates from the online business directory Cryptwerk, as of Nov. 25, show only 365 merchants worldwide as accepting SHIB for payment. That’s nothing when you consider there are over 500 million entrepreneurs worldwide, including more than 32 million businesses in the United States. The data is pretty clear that businesses have no desire to accept SHIB as payment.
Shiba Inu’s median hold time is also particularly low, although the launch of ShibaSwap has helped encourage longer hold periods. According to the leading crypto exchange and ecosystem Coinbase Global, the median hold period for SHIB is only 27 days. With so many momentum-chasers having piled into this trade, momentum to the downside could sink this ship just as quickly as it rose.
Lastly, history has shown that life-altering gains in the crypto space are eventually met with mammoth pullbacks. It’s not uncommon for digital currencies to lose 93% to 99% of their value after five-digit percentage gains in a short time frame. If this turns out to be the case, SHIB could fall all the way back to between $0.000006179 and $0.0000008741.
Make no mistake about it: SHIB offers a significant downside, even after losing over half its value.
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