Robert has reported for a variety of international publications including the Associated Press, The Guardian, Vice, and Decrypt. Current areas of interest include the political economy of technology, cryptocurrencies, and privacy. Robert has a Bachelor of Science from UCL, and a Master's degree from the University of Oxford's Internet Institute.
SHIB, or SHIBA INU token, is a popular spinoff of Dogecoin, a wildly successful meme coin that has famous supporters.
Meme coins are cryptocurrencies that grow to prominence because they are widely shared online. SHIB is one such meme coin. Created in August 2020, it spread like wildfire in 2021 due to its funny art style, cute branding, and its attachment to Dogecoin, a much larger meme.
Although SHIB is nowhere as valuable as Dogecoin, it maintains a respectable market cap of $2.3 billion, as of September 2021. However, at its peak in May, the token briefly spurted to a market cap of $13.8 billion, according to CoinMarketCap, and $19.5 billion dollars worth of SHIB changed hands on a single day.Buy and Sell Bitcoin, Ethereum, and over a dozen other cryptocurrencies with Wealthsimple. Sign up and Trade here.
But don’t let SHIB’s cutesy and playful demeanor fool you: It now houses a complex decentralized finance protocol that lets you earn extra tokens in fascinating and complicated ways. Meme finance is here, and its bite is just as strong as its bark.
First: What is Dogecoin?
To understand SHIB, one must first understand Dogecoin. Dogecoin is a meme coin that has as its mascot a chubby Shiba Inu that gained popularity as a meme about a decade ago. The dog would say such funny things as “much wow” and the images were widely shared across the internet.
In 2013, developers Jackson Palmer and Billy Markus thought it would be funny to create a cryptocurrency called Dogecoin. The coin would be a spinoff of Bitcoin, the coin that was becoming wildly popular, and they didn’t think it would have a huge amount of value. People were creating all types of cryptocurrencies at the time, and Dogecoin was just another coin.
The coin itself was a fork—a way of splitting the blockchain into something new by copying its code, or most of it, and turning it into a separate project—of Luckycoin, which itself was a fork of Litecoin, which was a popular Bitcoin fork created by former Google employee Charlie Lee.
Dogecoin had mild internet fame, and fans found much joy in using it to sponsor NASCAR drivers and the Jamaican Bobsleigh team. But it was never worth more than a fraction of a penny until 2021, when its price wildly increased amid that year’s crypto boom.
Bolstered by support from stars like Gene Simmons, Snoop Dogg, Mark Cuban, and Dogecoin’s most prominent backer, Elon Musk, the coin hit highs of $0.73 on May 8, when it reached a market cap of $88 billion. By way of comparison, Burger King has a market cap of $29.5 billion.
Critics will point out that Dogecoin’s market cap couldn’t actually be $88 billion, since that’s simply a crude multiplication of all the coins in circulation by the most recent price, and lots of those coins have been lost. Plus, the market’s incredibly volatile.
There is much merit to that criticism, which has been supported by the coin’s subsequent collapse, but Dogecoin did become immensely valuable for a short period of time.
What is SHIB?
SHIB was created in 2020 by a pseudonymous developer called Ryoshi. While Dogecoin has its own blockchain and miners, SHIB is based on the Ethereum blockchain. SHIB’s whitepaper claims that building on Ethereum, a blockchain that is “already secure and well-established,” ensures that the project is “free to change and evolve with zero outside regulations impacting it.”
SHIB is one of dozens of Dogecoin spinoffs, among them Baby Dogecoin, Dogelon, and FLOKI, a token named after Elon Musk’s pet Shiba Inu. SHIB started with a token supply of one quadrillion. Ryoshi locked 50% in decentralized exchange Uniswap and handed the other 50% to Vitalik Buterin, the co-founder of Ethereum.
The project claimed that handing the tokens to Buterin was akin to “burning” them, or removing them from circulation, since Buterin wasn’t likely to notice yet another worthless cryptocurrency project in his wallet. However, when the token took off, Buterin donated a chunk of his tokens to charitable causes helping to prevent the spread of COVID in India before burning a large portion of them.
“Thank you to the woofmeister for enabling true decentralization. Now we truly begin,” wrote SHIB. Alongside SHIB, the project has since launched LEASH, a token with a supply of 107,646 (far less than SHIB’s initial supply of one quadrillion). As of September 2021, LEASH trades for $848 per coin and has a market cap of $91 million.
Then there’s BONE, a governance token that lets the self-proclaimed ShibArmy vote on upcoming proposals on Doggy DAO, a decentralized autonomous organization that governs the project. BONE sells for $0.11 and has a fully diluted market cap of $110 million.
What is ShibaSwap?
The project now revolves around something called ShibaSwap, a one-stop-shop for earning money on the Shiba ecosystem. It’s remarkably complex for a joke around a dog coin.
In its own words: “ShibaSwap gives users the ability to DIG (provide liquidity), BURY (stake), and SWAP tokens to gain WOOF Returns through our sophisticated and innovative passive income reward system.”
In addition, ShibaSwap lets you provide liquidity to earn BONE tokens, migrate liquidity from decentralized exchange Uniswap and analyse portfolios.
ShibaSwap functions similarly to protocols like SushiSwap, which offer similarly complex offerings from the wild world of decentralized finance.
ShibaSwap’s volumes are no joke, either: It boasts $300 million in total value locked, according to DeFi Llama. And, even though noise around the coin has died down, SHIB’s Telegram group has 170,000 members.
An audit from May 2021 by Certik found major logical issues, plus problems with centralization, but these have since been resolved, according to a revision from July 2021.
How to buy SHIB, LEASH and BONE
SHIB, LEASH and BONE can be bought on ShibaSwap, or on decentralized and centralized exchanges.
The biggest market for SHIB, which commands 24% of its trading volume, is the USDT pairing on centralized crypto exchange Binance. Other centralized exchanges that list SHIB include Huobi Global, FTX, and OKEx.
To buy from a centralized exchange, you’ll need to create an account, usually submit some form of identification, and then buy your SHIB with a cryptocurrency or fiat (read: normal) currencies, like the US dollar.
To buy from a decentralized exchange, like Uniswap or ShibaSwap, you’ll have to send Ethereum-based cryptocurrency to a browser-based Ethereum wallet, like MetaMask. Then, connect your wallet to the decentralized exchange through its website.
According to CoinMarketCap, the most popular SHIB pairing is for WETH, or Wrapped Ethereum (an ERC-20-based version of Ethereum) on Uniswap.
LEASH isn’t available on popular centralized exchanges. Instead it trades on decentralized exchanges. Uniswap, ShibaSwap, and 1Inch are the most popular places to trade ShibaSwap, and WETH, SHIB, and ETH are the most popular pairings. BONE is only available on a few markets, and most of the pairings are for ShibaSwap.
You can also earn these tokens on ShibaSwap. There are two main ways to earn BONE. The first is to DIG: “There are tons of BONES under the ground. Provide Liquidity to earn BONE.” The second is FETCH: “Migrate your UNI V2-LP or SLP tokens to earn BONE.”
What next for SHIB?
Although its main token hasn’t performed as well as it once did, SHIB’s ecosystem is remarkably impressive for a token that started as a joke.
SHIB has launched the Shiba Inu Incubator to get the best out of the ShibArmy. “Through the power of the Shiba Inu Incubator, we help holders find the tools they need to bring their inspiration and unique perspectives to life,” writes the team on its site.
One of its first initiatives was the Shiba Artist Incubator, a three-week program for 10 emerging artists led by artists from the Shiba community, that gives them training and “growth experience.” Artists met each day on Zoom to work out art pieces to be displayed in ShibaSwap.
A whitepaper, or “Woof Paper,” describes the ultimate goal of ShibaSwap to “provide a safe place to trade your valuable crypto while remaining decentralized.” Growth from “good ‘ole fashion memes,” it hopes, “will reinforce the platform’s strength and ultimately provide residual benefits to the Ecosystem.”
However, critics would no doubt argue that to build a decentralized financial community on the back of a meme is like building a house on sand, and the internet may no longer find Dogecoin as adorable as before—the crashing prices of Dogecoin and SHIB would back this up.
Still, if SHIB can build up ShibaSwap, it could wield its memey branding as a powerful weapon.
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