My purchase of ‘meme tokens’ and its influence on the crypto-market
Written by: Jack Paolini
When I made the trade, I had no idea that the so-called “dogecoin killer” would actually mean killer returns in my bank account. Yet, the dogecoin spinoff surpassed many of my initial market growth predictions. Not only did the 30% hike strengthen cryptocurrency beliefs but it convinced consumers that meme coins may actually be another path towards financial freedom.
What is Shiba Inu:
Shiba Inu, a dogecoin spinoff, is a digital token that gained significant market traction in the last 24 hours hitting a record high above $0.0006. With a market capitalization of more than $29bn, shiba inu has been recognized as the 11th largest cryptocurrency. The branding of ‘shiba inu’ follows similar imagery of dogecoin, using the Japanese shiba inu dog. After anonymous creation in August 2020, the coin has granted the opportunity to promote decentralization and grow a fintech community. Based on the Ethereum blockchain, the token has pushed decentralized financial trends of lending and trading. While recent events of shiba inu are impressive, it is difficult to predict the price changes in the future. As global regulatory crackdowns continue; commentary made from founders and influencers like Musk; and other developments, the tokens still provide uncertainty. However, the uncertainty of the tokens translated through market volatility have shaped our perception of digital assets that should not go unnoticed.
Cryptocurrency Momentum & Risks:
As speculation continues about whether or not shiba inu will reach valuations of $1 during 2021, cryptocurrencies in general have gained traction. With this momentum comes great criticism. As an investment vehicle, investors must be educated on crypto asset risks as they seek to catch the high waves of returns. If not, they might regret taking the chance on tokens like shiba inu.
Risks associated with Crypto:
Consumer protection:
Despite investments advertising high returns seem appealing, the regulatory factors attributed to these assets may not be as favorable. Regulations go beyond anti-money laundering occurrences.
Price volatility:
If you are risk averse, the price volatility of crypto assets may not be as desirable. Restrictions for valuing crypto assets places many consumers at higher risk for losses.
Asset Complexity:
These assets do not follow traditional market mechanisms for building a safe investment portfolio. Many consumers still find it difficult to understand cryptocassts, especially since these assets may not be converted back into cash. With dependence on supply and demand for crypto, the ability for cash conversion is limited.
Charges and Fees:
Unlike other regulated investment products, consumers must be aware of the variances of charges on these investments. It might not be worth the investment if fees exceed the purchasing price.
What does this news mean for the future?
The shiba inu news paired with crypto growth means that there are greater influences in the market than ever before. Individual investors have great power similar to large intermediaries. The rise of dogecoin and shiba inu follows similar historic events like the GameStop saga that occurred at the start of the year. A group of retail traders inspired by a Reddit forum influenced the stock, leading to huge swings in the price. As traders continue to look for gains, cryptocurrencies have been a newfound outlet to continue making money with little help from large intermediaries.
Amongst the crypto-opportunists, shiba inu has been pushing as a new addition to the Robinhood platform. At Change.org, a petition has been initiated which has reached 300,000 signatures in support of the tokens’ trading capabilities. With dogecoin accounting for 62% of Robinhoods cryptocurrency revenue, the online brokerage just might see the value add of the new shiba inu community. While volatility plays heavily in the cryptocurrency space, especially for dogecoin and shiba inu, its influence has not hesitated investors as they seek a piece of hefty returns.
Resources:
https://qz.com/2080561/how-high-can-dogecoin-and-shiba-inu-coin-go/
https://www.the-sun.com/money/3365835/will-shiba-inu-price-rise-worth-2022/
https://www.change.org/p/robinhood-convince-robinhood-they-will-prosper-if-they-list-shiba-inu-coin
