Is Shiba Inu Dead? Here's Why It Doesn't Look Good for $SHIB

In 2021, Shiba Inu was an unstoppable force, a memecoin phenomenon that created millionaires overnight. But now, the hype has faded, the price has stagnated, and many are left holding the bag. Is Shiba Inu dead?”

Famously known as the “Dogecoin Killer,” Shiba Inu launched in August 2020 at the tail end of the meme-coin boom. SHIB captured investor attention through clever branding, heavy influencer support, and rapid community growth. Its biggest catalyst came when the founder burned 90% of his SHIB holdings, manufacturing extreme scarcity and sending the price parabolic.

Shiba Inu’s astronomic rise dominated headlines as small retail investments turned into life-changing fortunes. At its peak, SHIB hit a market cap of more than $40 billion and became listed among the top ten cryptocurrencies. In 2021 alone, it delivered an unprecedented 45,000,000% rally, making it the best-performing financial asset of the year.

Fast-forward five years: the hype is long gone. Many who bought near the top are deep in losses, waiting for a rebound that seems less likely with each passing market cycle. While the team attempted to evolve the project with the introduction of the Shibarium network, real-world utility remains limited. With the value of SHIB now down more than 85% from its 2021 all-time high and broader crypto prices experiencing prolonged stagnation, the moment of truth for the project has arrived.

Shiba Inu (SHIB) yearly chart. Source: CoinMarketCap

This article will argue that while Shiba Inu is not technically “dead”, its potential as a good crypto investment looks bleak. We will analyze three key reasons for this bearish outlook: the failure of its ecosystem to gain traction, the intense competition in the memecoin space, and its inflationary tokenomics.

Reason 1: The Shibarium Ghost Town

For years, the counter-argument to “SHIB is just a meme” was the promise of utility. The Shiba Inu team, led by the pseudonymous developer Shytoshi Kusama, promised to transform the project from a speculative joke into a serious decentralized finance (DeFi) ecosystem.

True to this, the team introduced Shibarium, a Layer-2 blockchain built on the Ethereum network with a compelling proposition. Shibarium was designed as a scalable and affordable platform for new decentralized applications (dApps), Shiba-themed games, and other metaverse projects.

However, the reality has been starkly different. Since its launch, Shibarium has experienced short-lived spikes in activity. For instance, its volume peaked at $10 million in late 2024 before slipping back to a low single-digit millions. For a project like Shiba Inu with a multi-billion dollar market cap, a TVL of this scale is extremely low and indicates that capital is simply not committing to the ecosystem, or there’s a deep distrust within the community.

The current applications on the blockchain system include ShibaSwap, WoofSwap, ChewySwap, MARSWAP, PunkSwap, Mantra Protocol, ShibPay, and K9 Finance DAO. Yet, ShibaSwap, which is considered the major DEX in the ecosystem, barely has a TVL of $1 million.

To put this into perspective, competitors like Arbitrum and Base boast TVLs in the billions, and even newer niche blockchains often attract tens of millions in liquidity within weeks of launching. Adding to concerns, the Shiba Inu team has been accused of promoting cumulative metrics, such as “total wallet addresses” or “total transactions,” that are reportedly misleading and largely inflated by test-phase activity.

The network remains a ghost town for applications. There are no breakout hits: no viral games, no innovative lending platforms, and no high-volume DEX to rival Uniswap or Aerodome. This lack of organic demand means users have little incentive to bridge their assets to Shibarium beyond merely holding SHIB. Transaction volumes reflect this, with daily counts frequently dipping into the low thousands.

Reason 2: The Memecoin Market Has Moved On

One of the reasons Shiba Inu thrived in 2021 was the broader bull run in the cryptocurrency market, particularly within the memecoin sector. That time, the Bitcoin price surged from around $30,000 to $70,000, drawing attention to the crypto space and indirectly boosting speculative altcoins like SHIB. Yet in crypto, attention is fleeting, shifting from Bitcoin to altcoins, from DeFi to AI-focused tokens, and from one sector to another.

We are now deep into a new market cycle, and the narrative has shifted decisively. Today, the market favors niche coins, particularly cryptocurrencies at the intersection of traditional finance and decentralized finance, such as Digitap. Likewise, “culture coins” like MOG and PolitiFi have emerged, turning election cycles and political figures into tradable assets.

Memecoin booms typically happen in projects with tiny market caps, where prices can multiply 100x or even 1,000x. With its multi-billion-dollar market cap valuation, Shiba Inu is unlikely to replicate such explosive returns, leaving it in a precarious middle ground that is neither safe nor capable of massive upside.

Furthermore, Solana has claimed the largest share of new memecoin liquidity. In 2021, Ethereum dominated this space, but today Solana hosts next-generation memecoins like Bonk (BONK) and Dogwifhat (WIF). Solana offers near-instant transactions with fees costing a fraction of a cent, enabling swaps worth $10 without losing $50 in gas fees. Without transformative changes, Shiba Inu risks losing relevance to faster, cheaper networks.

Reason 3: The Never-Ending Supply

Finally, it’s time to address the elephant in the room: Shiba Inu tokenomics. The math behind Shiba Inu is fundamentally working against its price recovery.

The coin launched with a total of 1 quadrillion tokens, and in what was a brilliant marketing stunt, the team gifted 50% of this supply to Vitalik Buterin, the co-founder of Ethereum, who subsequently burned 90% of his holdings (around 410 trillion tokens) and donated the rest to charity. This reduction in supply, coupled with increased demand, caused the price to explode.

However, the problem lies in the burn rate. Even if the community manages to burn 1 billion SHIB every single day, it would take nearly 3 years to burn up to 1 trillion tokens. Without any transformative 589 trillion tokens remaining, burning 1 trillion tokens only reduces the supply by less than 0.2%.

Essentially, to make a dent in the price through deflation, the community would need to burn hundreds of trillions of tokens. The current burn mechanism of using a portion of Shibarium transaction fees is negligible because transaction volume on the network is extremely low to generate such significant fees.

For SHIB to reach the much-discussed price of $0.01, its market capitalization would need to soar to approximately $5.89 trillion, nearly double the current market cap of Microsoft or Apple and far exceeding the total value of the entire cryptocurrency market. In practical terms, this makes such a target mathematically impossible under current global economic conditions.

Without a token-burning mechanism operating millions of times faster than the current rate, SHIB will remain an inflationary asset. Simply put, there are too many tokens in circulation and too many holders likely to sell once they break even, preventing any realistic path to massive price appreciation.

Conclusion

Undoubtedly, Shiba Inu has had an impressive run, and its community remains one of the most loyal and vocal in the crypto space. However, no coin price rises solely based on community loyalty. The evidence available points to a bearish outlook. First, Shibarium has largely failed to deliver on its promise of meaningful utility. Second, the crypto market has evolved, with trends now favoring AI-focused projects such as Render (RNDR), Fetch.AI (FET), and Bittensor (TAO).

Decentralized finance is another thriving sector, especially with the integration of digital asset banking tools and crypto virtual cards by emerging platforms like Digitap. Projects like Aave (AAVE), Saros (SAROS), and Hyperliquid (HYPE) are benefiting from this evolution. If Shiba Inu does not innovate beyond its current utility or address its token-burning challenges, it risks being displaced by newer, more versatile coins.

Mainstream adoption could provide another potential catalyst, similar to how Dogecoin gained traction. For years, Shiba Inu benefited from DOGE’s popularity and the Musk effect. With that influence gone, SHIB’s ability to compete depends on whether it can establish itself as a practical transactional currency.

For new investors, the opportunity cost of holding SHIB is high. The memecoin landscape shifts rapidly, and staying ahead of the narrative is essential. Tools like Digitap can help investors manage their portfolios, track emerging trends, and make informed decisions in this fast-moving market.

FAQs (Frequently Asked Questions)

Will SHIB ever reach $0.01?

Given Shiba Inu’s current tokenomics, reaching $0.01 is extremely unlikely in the short term. To hit that price, SHIB would need a market capitalization of around $5.9 trillion, which is nearly twice the total current crypto market cap, and 90% of its supply would need to be burned.

What is Shibarium?

Shibarium is a Layer-2 blockchain built on top of Ethereum, created specifically for the Shiba Inu ecosystem. Its primary goal is to reduce high gas fees and speed up transactions, making it more efficient than using Ethereum directly. The network uses the BONE token to pay for transaction fees, supporting decentralized applications (dApps), Shiba-themed games, and other ecosystem projects.

Is the Shiba Inu team still working on the project?

Yes, the team remains active, though their anonymous and hype-driven approach can make progress seem slow. Lead developer Shytoshi Kusama continues to release updates, and recent social media activity hints at a new phase for the project. Planned developments focus on enhancing Shibarium, forming strategic partnerships (e.g., Unity Nodes), and expanding ecosystem utility.

Why did the price of SHIB crash?

Shiba Inu’s price decline stems from several factors. First, like most cryptocurrencies, SHIB is highly speculative, making it vulnerable to market swings. Broader global economic conditions also affect investor sentiment. Additionally, token liquidity has dried up, meaning fewer active buyers and sellers. Without a fresh Bitcoin-led rally, renewed altcoin hype, or major market catalysts, the price is unlikely to rebound quickly.

What is a better investment than Shiba Inu?

Various analysts agree that “blue-chip” cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) are likely to continue leading the crypto market due to growing institutional adoption and lower volatility. For those seeking more affordable alternatives, Solana (SOL) and Binance Coin (BNB) remain popular options. Outside the crypto space, the most common recommendation is a low-cost S&P 500 index fund, which historically delivers an average annual return of 12% while maintaining relatively low risk.

Should I Sell my SHIB coins?

The decision to sell SHIB is ultimately personal and depends on opportunity cost. While the token’s loyal community offers some reason to hold, SHIB faces stiff competition from newer utility-focused coins. For investors whose holdings have remained stagnant while alternatives like Solana or Bitcoin have appreciated, it may make sense to cut losses and redirect capital toward higher-potential assets. However, if you hold a small amount and are comfortable with the risk, keeping SHIB can be viewed as a speculative bet on its future potential.

Are influencers and Whales abandoning SHIB?

To some extent, yes. Technical analysis indicates a slowdown in new wallet creation and address activity throughout 2025. Community posts reveal frustration over slow updates and unclear progress, while some reports suggest the team has encouraged AI-generated content to boost visibility. High-profile supporters like Elon Musk appear focused on Doge and Floki, with little mention of SHIB. Despite this, the Shiba Inu community remains loyal and continues to support the project.