Janice R. Andrews
The stock markets in 2024 are off to an explosive start thus far. The energy sector, new pharmaceutical breakthroughs, and the excitement surrounding artificial intelligence have all helped to fuel gains of about 11% for the S&P 500 and Nasdaq Composite. However, investors have a plethora of alternative options outside of the stock markets. In recent years, investors have begun to consider options other than stocks and bonds, such as bitcoin.
With a 69% price rise so far this year, Bitcoin (CRYPTO: BTC) has outperformed the market. But would you be surprised to learn that this year, Bitcoin isn’t doing as well as another cryptocurrency token? As of the close of business on May 20, Shiba Inu’s (CRYPTO: SHIB) price has risen by 136%, nearly twice as much as that of Bitcoin. Let’s look at if Shiba Inu is the ideal token for you and whether it’s a better option than Bitcoin for cryptocurrency investors.
Bitcoin vs. Shiba Inus: Advice Before Investing
Arguably, the most well-known cryptocurrency is Bitcoin. Bitcoin is becoming a more popular and accepted means of payment, although not being completely ubiquitous in today’s financial activities. Even though cryptocurrency generally has a more contentious image compared to other well-established asset classes, Bitcoin is frequently referred to as “digital gold” due to its reputation as a unique value amid uncertain economic scenarios.
There are several more cryptocurrencies than Bitcoin. It’s a common misconception that each of these tokens represents a competing offering to Bitcoin. This isn’t the case, actually. In truth, many cryptocurrencies are gaining popularity unnecessarily and are not really useful.
As you may recall, a few years back, when well-known people like Elon Musk and Mark Cuban seemed to embrace its usage, a token known as Dogecoin briefly came on the market. While a little humor has its place here, prominent investors and CEOs ought to refrain from being too specific when talking about the markets. The reason? Due to the backing of many billionaires, Dogecoin was oversupplied in the market by regular retail investors. Dogecoin’s price consequently gained tremendous traction, leaving many investors holding the bag.
Here’s where Shiba Inus start to matter. Like Dogecoin, Shiba Inu is categorized as a meme coin. Its price reflects the perception that it is not nearly as popular or sophisticated as Bitcoin. Shiba Inu now trades at $0.000026 and has a total of one quadrillion tokens in circulation. Shiba Inus are worth less than a cent, hence they are essentially worthless.
Given that it now costs around $69,000, pricing is mostly determined by supply and demand. On the other hand, Shiba Inu and the majority of meme currencies are merely the market value of people’s current beliefs as they are expressed on social media.
The Last Word
Shiba Inu’s percentage return in 2024 looks great, but this is definitely an example of the law of small numbers. In other words, a lucrative idea may be supported by a triple-digit return. However, Shiba Inus’s capacity for growth is likely more psychological than physical.
Furthermore, given the volume of tokens being traded, a sizable number of bullish investors will need to buy and hold Shiba Inu before its value even gets close to one cent, much alone one dollar. Even if the majority of people believe that investing in cryptocurrencies is riskier than in equities or bonds, investors might want to consider diversifying their portfolio by gaining some exposure.
That being said, I would caution investors from investing in meme currencies. It’s helpful to draw a link between memes and penny stocks. Just as with stocks, investors in cryptocurrencies seek out proven and reputable options. Notwithstanding the first appearance of the percentage returns, Bitcoin now prevails in those categories and is a safer alternative to Shiba Inus.
Given Shiba Inu’s meteoric rise in 2024, a lot of investors—especially those looking for the next big thing in the cryptocurrency space—might be intrigued in investing in it. Given its status as meme currency and intrinsic lack of value, it’s a risky bet. The sheer volume of Shiba Inu coins means that social media trends have a bigger influence on the token’s value than traditional economic ones.
Bitcoin, on the other hand, continues to lead the cryptocurrency industry due to its growing popularity and reputation as “digital gold.” Despite the fact that Bitcoin’s earnings aren’t always as spectacular as those of the flashier altcoins, its usage and track record make it a more reliable investment.
Investors who are considering venturing into the risky realm of cryptocurrencies might be better off sticking with well-known coins like Bitcoin. Shiba Inu may have enticing profits, but the fundamentals show that Bitcoin is still a superior investment. As always, investors should evaluate their risk tolerance and conduct enough research before investing in the bitcoin market.
