Shiba inu coin: Things to know about new cryptocurrency, dogecoin competitor
A new cryptocurrency, said to be a rival to dogecoin, has hit the market and risen in value by a massive 130 per cent in 24 hours.
Shiba inu coins are one of the latest cryptocurrencies to hit the market — we round up five things you need to know.
It comes as crypto fans are on the hunt for the next success story to follow Bitcoin.
Buying cryptocurrencies and decentralised finance tokens as well as stocks and shares is a risky business.
Investing is not a guaranteed way to make money, so make sure you know the risks and can afford to lose the money.
Cryptocurrencies are also highly volatile, so your cash can go down as well as up in the blink of an eye.
As always, you should never invest in something you don’t understand.
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1. Shiba inu is a token
Shiba inu coins are cryptocurrency meme tokens and allow users to hold trillions of them, according to its website.
These tokens are listed and incentivised on ShibaSwap, its own decentralised exchange.
Its website claims to have locked 50 per cent of its total supply to Uniswap, while the remaining has been burned to Ethereum founder Vitalik Buterin.
The tokens feature the same shiba inu dog as dogecoin, which has rocketed in popularity recently.
2. Its value has surged in 24 hours
The value of shiba inu is currently sitting at $US0.00003026, compared to a lower $US0.0000006 in mid-April, according to CoinMarketCap.
At the time of writing, it’s up by almost 130 per cent in 24 hours but it’s obviously starting from a low number so rises will appear bigger.
In comparison, dogecoin is currently worth $US0.51 – up from $0.005 at the beginning of the year.
A number of dogecoin look-alikes have thrived thanks to the recent surging value of the shiba inu-themed coin.
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3. It aims to replicate the success of dogecoin
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, told The Sun the token “appears to have been created” to give dogecoin a run for its money.
She added: “It features the same dog which became a meme, and aims to replicate dogecoin’s success of turning a joke into a money making machine.”
The value of dogecoin has surged thanks to celebrity backing, while a bunch of Reddit threads also called for it to hit a value of $US1 per coin.
The Shiba token website said: “Nicknamed the dogecoin killer, this erc-20 only token can remain well under a penny and still outpace Dogecoin in a small amount of time (relatively speaking).”
4. Investing is risky and you could lose it all
Investing in cryptocurrencies is essentially gambling and there are no guarantees that you will see what you pay in go up in value.
Cryptocurrencies are very high risk and a speculative investment, with limited track records and no underlying value.
There is also no guarantee that you can convert crypto assets back into cash, as it may depend on the demand and supply in the existing market.
Ms Streeter said: “Investors should treat trading in cryptocurrencies with extreme caution, and dabble at the edges of their investment portfolio, only with money they can afford to lose.”
While Nigel Green, chief executive of deVere Group, added: “Extreme caution should be exercised before investing in un-tested cryptocurrencies.
“The price swings can be expected to be wild and there’s a legitimate risk that investors could get burned.
“There are major differences between the likes of bitcoin, which runs on cutting edge tech and has a limited supply giving it scarcity value like gold, amongst other valuable attributes; and unknown digital tokens which seemingly have no inherent value.”
5. Warning over new cryptocoins
It is unclear if shiba inu is legitimate. Very little is known about it and this could mean that your money is at higher risk.
Newer cryptocurrencies are the most risky, as it’s harder to tell if they’re legitimate.
This means you’re more open to fall for a scam.
UK crypto asset businesses must register with the Financial Conduct Authority – and you can check to see if they are on the Financial Services Register or if they are on a list of firms with temporary registration.
There is also a list of businesses not registered. If they are on this list then they may be operating illegally.
Even if they are on the list the city watchdog is not responsible for regulating them and they don’t have any power over how they conduct business with customers.
Essentially it is very hard to tell which firms are real and which ones are scammers.
Cryptocurrency firms also aren’t regulated in the way that other financial firms are, meaning you won’t have any protection if things go wrong.
You won’t be able to take a complaint to the Financial Ombudsman Service, for example.
In January, the UK Financial Conduct Authority warned people they risk losing all of their money if they invest in cryptocurrencies.
Meanwhile, an advert for a bitcoin exchange Coinfloor was banned in March for telling savers cryptocurrencies are a safe investment.
People considering investing in Bitcoin or shares and stocks have also been warned over “risky” tips being shared on TikTok.
How to spot crypto scams
Crypto scams are popping up all over the internet. We explain how to spot them:
Promises of a high or guaranteed return: Does the offer look realistic? Scammers often attract money by making fake promises.
Heavy marketing and promotional offers: If they are using marketing tricks to con customers you should beware.
Unnamed or non-existent team members: Just like any business you should be easily able to find out who is running it.
Check the whitepaper: Every crypto firm should have a white paper. This should explain how it plans to grow and make money. If this doesn’t make sense, then it could be because the founders are trying to confuse you.
Do your research: Check reviews online and Reddit threads to see what other people think.
This story was originally published on The Sun and is reproduced here with permission
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