Everyone knows that diversification is the best policy when investing because it reduces the overall risk in a portfolio and increases the likelihood of positive returns by distributing capital across various types of assets that have different profiles and therefore perform differently. Therefore, adding meme coins to one’s portfolio, for diversification purposes, alongside other crypto subsets like currency coins, stablecoins, utility tokens, or DeFi tokens, makes perfect sense.
However, whenever investors seek to learn how to buy cryptocurrency and diversify their crypto portfolios with meme coins, their attention is inevitably drawn to Dogecoin since this is the most popular and valuable coin in its category. With the meme coin leader stealing all the spotlight, many are unaware that there are other meme tokens that might be just as or even more deserving of being included in their holdings, and Shiba Inu (SHIB) provides the perfect example in this respect.
Still, some might be reluctant to choose Shiba Inu over the main meme coin, since they’re less familiar with it. This is a perfectly reasonable attitude, as no one should make investment decisions without having a good understanding of the market and the assets they’re dealing with, so let’s see what Shiba Inu has going for it.
A meme coin with a purpose
At first glance, you might think there’s nothing differentiating Shina Inu from the many meme coins in the market, but don’t get fooled by its unassuming appearance. Indeed, Shiba Inu may have been built on the same foundation as all other meme coin projects, which consists of catchy internet memes and pop culture references that people resonate with, lighthearted humor, the support of an engaged community, social media hype, and speculation. These are the gimmicks that meme coins usually employ to draw attention to themselves and deflect from the fact that there’s not much going on under their clever branding.
However, Shiba Inu is more than just another hype-fueled dog-themed meme coin, as some might categorize it before learning more about it. What makes SHIB stand out from the rest of its peers is its ongoing development. Meme coins are known for not taking themselves too seriously, but Shiba Inu has deviated from this path by integrating new functionalities and focusing on utility rather than relying on humor and community support to insert itself into the conversation and ensure success in the long run.
So, even if Dogecoin has the first mover advantage and a higher market valuation than Shiba Inu, the latter scores important points for being more innovative. The project has created an elaborate ecosystem with the introduction of novel features like ShibaSwap, a decentralized exchange where users can trade different tokens, and Shibarium, a layer-2 scaling solution built on the Ethereum blockchain and meant to boost Shiba Inu’s performance by increasing transaction speed and lowering fees.
As for future prospects, Shiba Inu has plans to build its own metaverse, a virtual space powered by Shibarium, where users will be able to buy plots of land and participate in all types of activities that can help them earn passive income while also supporting the ecosystem’s economy.
Therefore, SHIB is no longer just a superficial meme coin with no practical use cases. With all the things happening in the Shiba Inu space, it’s easy to assume the project will continue to develop and solidify its standing in the crypto market through its initiatives and real-world applicability.
By contrast, Dogecoin’s development has been much slower. The coin has very limited use cases, being mostly utilized as a cryptocurrency, for tipping, donations, and payments with select merchants. However, its adoption as a payment solution is not nearly comparable to that of Bitcoin and Ethereum.
Growth potential
If you take a look at SHIB’s price evolution, it’s easy to see that the meme coin hasn’t performed all that well in recent months. The token increased by only 2% in the past month and registered a 16% loss over the last 3 months, currently trading at $0.000013, with a market cap of $7.87B USD. Dogecoin had fared much better, in comparison, having risen by 12% in the last month and by 113% over the past year. It’s understandable why investors are not flocking to buy SHIB, as the sentiment around the coin is largely neutral.
Given these figures, one would naturally conclude that Dogecoin is the better buy of the two, but that’s not necessarily the case. Dogecoin has maintained a relatively stable price for months now, with only occasional swings, with no clear signs of a major upward trend in sight. Besides, there aren’t many factors that could propel DOGE to new heights as the frenzy around meme coins has subsided, leaving the leader with few resources to move further.
Shiba Inu, on the other hand, finds itself in a different situation at the moment. The coin is in a period of decline, which means now would be a good time for investors to apply the buy-the-dip strategy and purchase SHIB at a low price, so they might reap the rewards when the asset starts appreciating.
Let’s also not forget that in November 2021, Shiba Inu had a brief moment of glory when it surpassed Dogecoin in market capitalization. Crypto history has a tendency to repeat itself, and that scenario could replay at some point in the future. If there’s one meme coin that has the ability to bounce back and go on a bullish rally, that would be SHIB, given its increasing functionality.
Final thoughts
Shiba Inu is a noteworthy option should you want to expand your crypto exposure with meme coins. However, every investor should base their moves on in-depth research and the personal goals they have established, and not follow in anyone’s lead blindly. So, it’s up to you to decide which meme coins, if any at all, would make a good addition to your portfolio.