Shiba Inu is one of the most popular cryptocurrencies out there. Even though many crypto investors dismiss meme coins outright, the fact remains that SHIB is the 13th largest crypto asset by market capitalization, surpassing the likes of Litecoin, Polkadot and TRON.

SHIB, which exists as an ERC-20 token on the Ethereum blockchain, has more than 1.2 million holders. Much of the SHIB’s popularity comes from its meme coin status, as it’s often promoted by its holders on various social media platforms through memes and viral campaigns.

However, SHIB was not spared during the cryptocurrency bear market of 2022. After reaching its all-time high in October of 2021, the token went through an intense bearish phase that has brought the SHIB price 87% below its all time highs. When SHIB was on the way up, many token holders were wondering if Shiba Inu will reach 1 cent. This was a reach even in the bull market, and is extremely unlikely now. 

In this article, we’ll be tackling the question of whether it’s possible for SHIB to hit a penny. Before we get started, however, let’s take a brief look at the story of the Shiba Inu project and its journey towards the top of the crypto markets.

Shiba Inu—The meme coin that went from nothing to billions of dollars

Shiba Inu was launched in August 2020 without much fanfare. The token was presented as an alternative to Dogecoin, and was sometimes referred to as “the Dogecoin killer”. In contrast to Dogecoin, which has its own blockchain, SHIB is issued on the Ethereum blockchain. This gives it a lot more potential use cases, as the token can easily be deployed in decentralized finance applications. 

The creator of Shiba Inu is known under the pseudonym Ryoshi. Another important figure in the Shiba Inu project is Shytoshi Kusama, who serves as the lead developer. 

SHIB was largely unknown for about half a year after it was created. Before 2021, its trading volume was extremely low, less than $1,000 on most days. Ironically, the catalyst that brought Shiba Inu to the limelight was Dogecoin, which Shiba Inu was meant to replace. Dogecoin’s massive price increase in the early part of 2021 led crypto speculators to look for “the next Dogecoin”, and the market settled on Shiba Inu as the best candidate. 

Will Shiba Inu reach 1 cent?

So, will Shiba Inu reach 1 cent? It would be extremely difficult, to say the least. Even during SHIB’s all-time high in October 2021, when the token was trading at $0.0000881, SHIB would have needed to increase in price by 113x to hit a price of $0.01. 

While SHIB has seen massive price increases in the past, the chance of hitting large multiples becomes smaller as the market cap of the asset grows. For example, it would not be so outlandish to say that a cryptocurrency with a market cap of $10 million could potentially 100x in price over a long enough time period. 

At its all-time high, SHIB had a market capitalization of $43 billion. At that kind of size, even a 2x price increase would have required a massive amount of capital to flow into SHIB. Achieving a 113x multiple from a $43 billion market cap asset would be next to impossible. 

For more context on why it’s so unlikely anything could boost SHIB to a penny, let’s take the example of Bitcoin. At its absolute peak, BTC had a market capitalization of $1.27 trillion. If SHIB were to reach $0.01, it would have a market capitalization of approximately $5.89 trillion, which would be 4.6x larger than Bitcoin at its very peak. 

At the time of writing, Apple is the world’s most valuable company, with a market capitalization of about $2.14 trillion. Saudi Aramco is in second place with a market cap of $1.88 trillion and Microsoft comes third with a $1.75 trillion market cap. At a price of $0.01, SHIB would have a larger market capitalization than the three largest companies in the world combined. 

The “cheap coin” fallacy 

So, if the market cap of Shiba Inu would be so outlandish if SHIB reached $1 or even $0.01, why do we see people oftening these price targets so often on social media platforms? The reason is what we like to call the “cheap coin” fallacy.

Most meme coins have a very large circulating supply, which results in a low price per unit. Sometimes, we refer to such cryptocurrencies as penny cryptos. This was already a feature of Dogecoin, which launched back in 2013, but the newer generation of meme coins like Shiba Inu has taken this concept to the extreme. 

Dogecoin’s current supply is 132 billion coins, with about 5 billion new coins being added per year. Shiba Inu, on the other hand, has a supply of 549 trillion tokens. As a result, the price per token is extremely low—at the time of writing, 1 SHIB is only worth $0.00001110. 

At a surface level, this makes SHIB seem approachable and cheap to new investors in crypto. For example, some people that are looking to invest in crypto for the first time avoid Bitcoin because 1 BTC is “too expensive”, even though its possible to buy as small a fraction of Bitcoin as you’d like.

When there are viral social media campaigns urging people to buy Shiba Inu in order to “get SHIB to a penny” or “get SHIB to $1”, some people don’t stop to think about what that would actually entail because $0.01 and $1 seem like small numbers. 

In reality, you shouldn’t be looking at a coin or token’s price per unit when trying to see if it is undervalued or overvalued. Instead, you should be considering the coin or token’s market capitalization, as that’s what will actually allow you to get an idea of how it compares to other crypto assets in terms of size. 

However, the fact remains that some people are drawn to coins that have a low price per unit due to the “cheap coin” fallacy. If you’re a speculator, you can sometimes leverage this to your advantage. 

Can SHIB still go up?

Even though we’ve hopefully demonstrated that you shouldn’t expect SHIB to ever reach 1 cent, that doesn’t mean that there isn’t any potential upside for Shiba Inu. The token is trading 87% down from its all-time high price, so people buying SHIB at current price levels are truly “buying the dip”. 

The Shiba Inu project is quite well established, as it has a large base of token holders and listings on major cryptocurrency exchanges. So, if there is a cryptocurrency bull run again and demand for Shiba Inu rises, interested buyers will have no problems with acquiring the token. 

From the fundamental side of things, the Shiba Inu team is working on several products that are geared towards making SHIB  a more attractive token to hold. The most notable of these products is Shibarium, a layer 2 scaling platform for Ethereum. 

According to Shiba Inu developers, Shibarium will be focused on providing cheap and fast token transactions for metaverse and gaming use cases. Shibarium will also incorporate a burning mechanism in which SHIB tokens will be burned with each transaction.

Shibarium Update ? While on our last post we wanted to remind everyone that BONE ? serves as the required gas token for operability within Shibarium, we also would now like to formally announce that each #Shibarium transaction will burn ? SHIB. 1/2 ? pic.twitter.com/zQRoOuL9oW

— Shibarium Network (@ShibariumNet) January 7, 2023

Other projects being worked on by the Shiba Inu team include the ShibaSwap decentralized exchange, the Shiboshis NFT collection and SHIB: The Metaverse. 

If these products are widely adopted, they could serve as a catalyst for the price of SHIB to move higher and make it one of the best cryptos to buy. However, SHIB is still mostly perceived as a speculative meme coin, so it will likely take favorable conditions in the broader crypto market in order for SHIB to see substantial gains.

Of course, there’s no guarantee that a coin will ever reach its previous all-time high again. This is especially true for Shiba Inu, which has only been around since the summer of 2020 and therefore doesn’t have a long price history that would help us understand how SHIB tends to behave across crypto market cycles.   

The bottom line—don’t expect Shiba Inu to reach 1 cent

If you’re making a Shiba Inu price prediction, the 1 cent price level is more or less out of the question. As we’ve shown, such a price level would imply a completely unrealistic market capitalization of $5.89 trillion for Shiba Inu. Of course, Shiba Inu going to 1 dollar is an even more unrealistic scenario.

However, this doesn’t mean that it’s impossible for the SHIB price to grow. If the cryptocurrency market enters another bull run, SHIB could very well be one of the meme coins to explode. The Shiba Inu team is working on key products like Shibarium, and SHIB is positioned well thanks to numerous crypto exchange listings. 

Shiba Inu is of course not the only contender in the meme coin sector. If you’re interested, check out our list of the meme coins that could be the next to explode.