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Both Dogecoin and Shiba Inu have emerged as major players in the meme coin world. Their light-hearted branding has proven popular in the market, catapulting them to success.
While they may seem similar on the surface, these two coins have important differences that set them apart and provide distinct use cases and investment factors to consider.
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Overview of Dogecoin and Shiba Inu
Launched in 2013, Dogecoin was the first ever so-called meme coin, a digital asset launched explicitly as a joke. The currency was created by software engineers Billy Marcus and Jackson Palmer partly as a way to poke fun at Bitcoin and its growing popularity. What the developers were not to know, of course, is that their own currency would go on to be worth tens of billions of dollars.
What began as a meme featuring the Shiba Inu dog breed quickly grew into a hugely popular cryptocurrency bolstered by a dedicated community as well as press and notoriety from public figures like Elon Musk.
DOGE managed to identify a real-world use case and became a popular way for cryptocurrency users to issue tips and carry out small transactions that would be cost-prohibitive with currencies like Bitcoin due to the higher fees involved, especially in years gone by.
In 2020, the Shiba Inu cryptocurrency emerged as a potential “Dogecoin killer.” Built on the Ethereum blockchain as an ERC-20 token, Shiba Inu aimed to capitalize on the meme coin trend while offering more utility than Dogecoin. Due to being issued on Ethereum, Shiba Inu can integrate with decentralized finance and offers access to DeFi services not supported by Dogecoin.
Let’s explore these differences more in the below section.
What’s the difference between Dogecoin and Shiba Inu?
One of the biggest differences between Dogecoin and Shiba Inu is the technology behind them. Dogecoin operates on its own blockchain and uses a Proof-of-Work (PoW) system, similar to Bitcoin. The Dogecoin blockchain is capable of fast and low-cost transactions, ideal for tipping and microtransactions, but limited in terms of interoperability with other blockchains or crypto services.
(SHIB) Shiba Inu, on the other hand, is not as robust in terms of rapid transactions at a low cost but arguably offers more utility.
As an ERC-20 token, SHIB can interact with essentially any Ethereum-based applications and smart contracts in the world. However, this also means that Shiba Inu is subject to Ethereum’s sometimes high gas fees and slow transaction times, depending on network congestion.
Finally, a major difference lies in their supply strategies.
Dogecoin has an inflationary supply model, where 5 billion new DOGE coins (DOGE) are introduced each year. Many crypto users found themselves exasperated at the popular “Doge to $1” campaign that became popular in 2021 among novice entrants to the space, as the price point would have required DOGE to reach a market cap of around $130 billion.
Meanwhile, Shiba Inu has a fixed supply, with an enormous initial number of 1 quadrillion tokens. The supply is often touted as a reason that individual SHIB coins are described as ‘cheap’ or affordable. Again, however, this belies a lack of understanding of tokenomics, as what investors should be considering is the market cap rather than the price of a single coin when measuring value.
About half of the SHIB supply was burned or removed from circulation, but the remaining supply still impacts its value potential.
Of course, to do a true Shiba Inu vs. Dogecoin comparison, we must consider the price history of these two coins.
Dogecoin vs Shiba Inu: market performance and volatility
Both coins have experienced dramatic price swings, often driven by social media and public figures. Let’s weigh up Shiba Inu vs Dogecoin comparison.
Dogecoin, thanks to endorsements from individuals like Elon Musk, saw its price peak in 2021 at $0.7376.
Shiba Inu peaked later in the same year at $0.00008845, fueled by the hype of its growing community.
In terms of market capitalization, Dogecoin consistently ranks higher and now stands at $15.6 billion compared to $9.6 billion for Shiba Inu. The coins are currently ranked at #8 and #13 in the overall market cap rankings respectively.
This reflects Dogecoin’s broader adoption as a simple and accessible cryptocurrency, while Shiba Inu’s complex DeFi potential offers more speculative value. However, SHIB is catching up, with a 118% growth in price over the last 12 months compared to a 69% growth this past year for DOGE.
Shiba Inu vs Dogecoin price prediction
Let’s take a look at the potential price forecast for Doge vs. Shiba.
Shiba Inu price prediction
Shiba Inu’s future largely depends on the success of projects like Shibarium, a layer-2 solution designed to reduce Ethereum’s high gas fees and increase scalability. If Shibarium succeeds, it could drive further adoption and increase SHIB’s value. However, its vast token supply may continue to weigh down the price.
As mentioned earlier, it’s interesting to note that Shiba Inu has had a strong year, but it’s quite a ways off its yearly high seen in May, with many pockets of resistance to break through before it approaches that price range.
Dogecoin price prediction
For Dogecoin, price predictions are often influenced by media hype, particularly driven by high-profile endorsements. Without significant technological advancements or new real-world use cases, its price may fluctuate based on speculative trading.
For a meme coin that was never intended to be taken seriously, it has certainly shocked the world with its strong community and price action. However, it’s difficult to accurately predict any sort of price action for this currency due to the somewhat whimsical nature of its upwards and downwards price momentum in the past and inflationary supply tokenomics.
Unlike Shiba Inu, Dogecoin is not particularly linked to success in the DeFi sector, and its success or failure is really anyone’s guess.
Which is better: Dogecoin or Shiba Inu?
So, Dogecoin vs. Shiba Inu: which is better?
When it comes to deciding which is better: Doge vs Shiba, the answer largely depends on your goals as an investor. The difference between Dogecoin and Shiba Inu is largely the transaction speed vs. functionality of the transaction, but in the end, both of these assets are meme coins.
Dogecoin offers a simple, fast, and low-cost cryptocurrency with an active community, making it a good choice for those looking for everyday utility or a fun investment.
It’s important to note that Dogecoin is by no means the only fast and low-cost cryptocurrency, nor is it the fastest or cheapest of the many options now available on the market, most of which have more features and integrations than Dogecoin. With no real utility in the modern crypto space beyond the potential for speculative gains, this is a particularly high-risk investment, even for a cryptocurrency.
Meanwhile, Shiba Inu provides more opportunities within the DeFi space due to its integration with Ethereum, offering higher potential rewards but also greater risk due to its volatility and dependence on Ethereum’s infrastructure.
Again, Shiba Inu is far from the most feature-laden or well-built DeFi currency on the market, and it has no edge or advantage over other ERC-20 tokens, and would be considered to have a disadvantage in the eyes of many investors.
At the end of the day, what these coins offer is simply a dedicated community that gets together to have fun and share memes rather than a serious investment opportunity. However, that’s not to say that seasoned investors cannot learn technical analysis to attempt to trade the charts for these meme coins.
This article first appeared at crypto.news
