Up 10,000%, Is This Meme Coin the Next Shiba Inu
Meme coin Bonk has exploded in price this year, but should you invest?
Remember 2021, when crypto investors were convinced that investing a few hundred bucks in a cute, dog-themed meme coin would make them millionaires overnight? Well, the same type of speculative meme coin mania that fueled the rise of Shiba Inu (SHIB 3.07%) could be making a comeback as we head into 2024.
The newest dog-themed meme coin is Bonk (BONK), which is up an absolutely ridiculous 10,000% this year. Bonk now has a $1.2 billion valuation, and some crypto insiders are predicting that Bonk will soon pass Shiba Inu in market cap. Although Bonk's recent performance is certainly impressive, there are two big reasons you should be cautious about investing in what some are citing as the next Shiba Inu.
Coin supply issues
If there's one lesson that should have been learned from the last bout of meme-coin mania, it's that the total circulating supply of a coin matters. Meme coins can get big fast by creating a seemingly unlimited supply when they launch. With a large enough supply, you can pump up the valuation of a meme coin to over $1 billion, even with a ridiculously low price. And that $1 billion valuation immediately gives an aura of credibility to the coin, especially for naive investors who might be new to crypto investing.
That is the fundamental problem of Shiba Inu -- it has an outrageously large circulating coin supply of 589 trillion. This absurd coin supply explains why the price of Shiba Inu continues to hover around the $0.00001 mark. It's almost mathematically impossible for Shiba Inu to reach the $1 mark because that would imply an outlandish market valuation of $589 trillion. So Shiba Inu is forced to burn coins as fast as it can, in the hopes of reducing the circulating supply significantly.
