What is Shiba Inu & How Does it Work? - SHIB for Beginners

Why Was Shiba Inu Invented?

The most popular meme coin, Dogecoin, experienced massive growth and popularity in recent years. Dogecoin was inspired by the Shiba Inu dog and saw millions of people, including the likes of Elon Musk, invest in the cryptocurrency and promote its use.

The Shiba Inu coin was created to provide competition for Dogecoin. Some even termed it as a “Dogecoin Killer” at some point. The Shiba Inu coin (SHIB) was first listed on ShibaSwap, a decentralised exchange launched by the Shiba Inu developers themselves.

SHIB was launched in August 2020 but has experienced massive growth and evolution over the past year. Shiba Inu has become popular for investing in a wide range of projects within the cryptocurrency space, especially in decentralised finance (DeFi) and non-fungible token (NFT) projects.

Shiba Inu has gained wide adoption within the cryptocurrency space. Vitalik Buterin donated 10% of his Shiba Inu investment to a COVID-19 relief effort in India while burning the remaining 90% liquidating his entire Shiba Inu holdings. This drew huge amounts of attention to the previously obscure project, and forced it into the spotlight for the first time.

How Does Shiba Inu Work and What Technology is Behind It?

Shiba Inu, unlike Dogecoin which operates on its own blockchain, is hosted on the Ethereum network as an ERC-20 token. The Shiba Inu ecosystem comprises three tokens, which are used to ensure everything operates as expected.

The first token is SHIB, the Shiba Inu token. This is the functional currency of the ecosystem that seeks to challenge Dogecoin. It is the investment coin that investors hold with the hopes of making profits from their investments. The second token is LEASH. Initially designed to be the rebase token, LEASH was remodelled and is now the second incentive-based token on the ShibaSwap exchange. Finally, the third token is BONE, which is designed to be used as the governance coin of the Shiba Inu ecosystem. It allows holders to vote on upcoming proposals to the Shiba Inu ecosystem.

What really separates Shiba Inu from Dogecoin is the ShibaSwap decentralised exchange (DEX). The DEX allows Shiba Inu to be a core part of the DeFi ecosystem on the Ethereum blockchain. This allows Shiba Inu users to enjoy certain features such as swapping tokens, staking and yielding. These features are unavailable on other major competitors of SHIB such as Dogecoin.

Is Shiba Inu Real Money?

Within the cryptocurrency space, the likes of Shiba Inu and Dogecoin are known as meme coins. They were mostly created for fun, and some of them don’t have an actual impact within the crypto space or in the real world. The Shiba Inu token is a meme cryptocurrency, and it is hard to consider it real money.

The cryptocurrency space has some coins that are far worthier to be considered as real money. These cryptocurrencies, like DASH, are purposely designed to serve as a medium of exchange between merchants and their customers globally. Some of these coins, like Litecoin and DASH, have gained adoption in various parts of the world.

While meme coins cannot be considered real money, the class of cryptocurrencies that come close to this description are stablecoins. Stablecoins are cryptocurrencies whose values are tied to fiat currencies. This means that, unlike regular cryptocurrencies, their values don’t fluctuate much. Since these stablecoins are pegged to fiat currencies, they can be used as an alternative to real money.

Fees & Expenses of Shiba Inu

The transaction fees attached to buying and selling Shiba Inu are dependent on the cryptocurrency exchange an investor is using. Each exchange has its fee structure, and that would determine the amount users would pay for buying or selling the SHIB token. We encourage readers to do some research about prospective crypto exchanges and trading platforms. Find out about their fee structures before making any decision.

Furthermore, as an ERC-20 token, there could be gas fees attached when buying the Shiba Inu token. Ensure you properly look at the expected gas fees if you want to buy SHIB from the ShibaSwap DEX or other trading platforms.

What Are the Benefits of Shiba Inu?

As one of the leading meme coins in the world, Shiba Inu offers some benefits to cryptocurrency traders and investors. Some of these benefits include;

Decentralised exchange

One of the core benefits of the Shiba Inu token is that the ecosystem has its own decentralised exchange. With its decentralised exchange, investors can be certain of gaining access to the SHIB token at any time with ease. Furthermore, it presents room for growth for the Shiba Inu ecosystem as it makes it a part of the decentralised finance space. ShibaSwap intends to become one of the safest and best decentralised exchanges in the cryptocurrency industry, and this could be a positive thing for the investors.

Popularity of meme coins

Meme coins are trendy in the cryptocurrency space. They have exploded into the scene in recent months, and investors seem to notice them and keep a tab on their performance. Shiba Inu aims to utilise this meme mania for gaining popularity and build a use case for its token in the long run. Check out our Shiba Inu forecast to see where we think it’s heading. 

Can Shiba Inu Be Used Anonymously?

Anonymity is no longer guaranteed in the cryptocurrency space. The market has experienced tremendous growth in the past few years, and strict regulations have made it almost impossible to conduct transactions under the radar. With the crypto market now over $2 trillion, regulators are asking more cryptocurrency exchanges and other service providers to implement KYC (Know Your Customer) and AML (Anti Money Laundering) policies to curb the negative use of cryptos.

The Shiba Inu token is not a privacy coin and doesn’t have the features that could ensure all transactions are private and anonymous. Without those features, it would be tough to ensure that SHIB can be used anonymously by investors or traders.

How Safe is Shiba Inu?

So far, Shiba Inu can be categorised as a safe token. The token is hosted on the Ethereum network, one of the most secure blockchains in the cryptocurrency space. However, despite the security offered by the Ethereum blockchain, the investor should also take steps to ensure maximum security for his SHIB investment.

The best wallets to store the SHIB tokens are the cold storage wallets like the Ledger. Hot wallets are connected online and do not offer high-security levels of cold storage wallets. Furthermore, we encourage investors to put in place extra security features like the 2FA on their wallets.  

What Teams Are Working On Shiba Inu Development

Shiba Inu was created by a developer or group of developers named Ryoshi in August 2020. The team has remained anonymous. Ryoshi has claimed that his/her/their identity is not important. The developer has been in charge of the Shiba Inu project since it was created a year ago.

With the BONE token, the Shiba Inu community members can take part in its governance and vote on possible changes and upgrades to the network.

Which Financial Institutions are Invested in Shiba Inu?

At the moment, there are no major financial institutions that have invested in Shiba Inu. Although financial institutions are starting to show interest in cryptocurrencies, most of the interest has been focused on the leading coins such as Bitcoin, Ether, Cardano, XRP, Litecoin, and others. Unlike Dogecoin which has gained the support of Elon Musk, Shiba Inu doesn’t have a popular name backing it currently.

The developer sent Vitalik Buterin some SHIB tokens early on to generate some popularity for the token but Vitalik has already donated some of the tokens while burning the remaining tokens. However, as the cryptocurrency space continues to grow, financial institutions might become interested in meme coins like Shiba Inu.

Shiba Inu Mining

Shiba Inu tokens cannot be mined. Shiba Inu is an ERC-20 token without its own blockchain, and mining the coin is not possible. Currently, it can be purchased from exchange/broker platforms. 

Shiba Inu Wallet

Shiba Inu is one of the leading 50 cryptocurrencies in the world and it is also a top ERC-20 token, which means it is available on a wide range of wallets that support Ethereum-based tokens. Some of the wallets to use for storing your SHIB tokens include;

• Ledger Nano X (cold storage wallet)

• Trezor (cold storage wallet)

• Ellipal Titan (hardware wallet)

• MetaMask

• Lumi wallet

• Coinomi

• CoolWallet

• Guarda Wallet

Regardless of your wallet choice, we encourage readers to implement the necessary security features like the 2FA to ensure maximum security for your SHIB tokens.

Is Shiba Inu Worth The Investment?

The investor has to decide whether Shiba Inu is a cryptocurrency worth investing in after studying the project. You have to analyse what the token does and what its future holds in the cryptocurrency space before making any decision. 

Meme coins have become very popular in the cryptocurrency space, and even people outside the sector know about them. Due to their popularity, meme coins like Dogecoin and Shiba Inu could likely get more attention from investors over the coming years which may lead to increases in the price of SHIB.

However, we recommend approaching cryptocurrency investment with caution due to the volatile nature of the market and the numerous uncertainties present. When investing and buying Shiba Inu or any other crypto project, only invest an amount you can afford to lose.