Crypto Briefing goes down the meme coin rabbit hole to see if Shiba Inu has what it takes to grow into a more serious crypto project worthy of its $6.4 billion market cap.
Shiba Inu wants to become more than just a meme, but that could be a challenge.
After experiencing a parabolic run that catapulted SHIB up over 1,000% in the fall of 2021, the Ethereum-based meme coin has continued to surprise market participants with its stubbornness in the face of what may be the most severe crypto bear market in history.
While SHIB gained its footing as a retail investor-backed meme coin, it’s maintained its position as a top 20 cryptocurrency, outperforming many other more established projects during the market downturn. Shiba Inu’s relative strength is partly thanks to its dedicated holder base and online community. The token’s faithful adherents continue to hold SHIB despite brutal market conditions while bringing its community to life across Twitter, Reddit, and other social media platforms.
Additionally, unlike Bitcoin and Ethereum, which bore the brunt of the recent spate of crypto firm liquidations, SHIB has suffered relatively little contagion as few—if any—companies had leveraged exposure to the token.
It’s become clear that despite setbacks, such as Ethereum co-founder Vitalik Buterin selling and burning trillions of SHIB tokens sent to his wallet by the project’s pseudonymous creator Ryoshi, Shiba Inu is here to stay. Over the past year, the project’s developer team has formed a plan to help Shiba Inu transcend its reputation as a moonshot token and develop into a fully-fledged crypto ecosystem.
After rising to public attention during the 2021 bull market, Shiba Inu’s developers have crafted several initiatives to help what started as a simple meme token gain traction as a more legitimate project.
So far, Shiba Inu’s pseudonymous developers have executed plans to create an Ethereum-compatible Layer 2 chain called Shibarium, a collection of cute NFT avatars known as “THE SHIBOSHIS,” a Metaverse, a mobile play-to-earn game, and a Shiba Inu-themed stablecoin.
While slow, progress is being made. In November 2021, Shiba Inu’s first NFT collection, THE SHIBOSHIS, launched in a whirlwind of hype, spiking Ethereum gas fees as fans rushed to mint one of the 10,000 pixel art avatars. More recently, in April, the Shiba Inu team conducted a sale of 100,000 virtual land plots for an upcoming Shiba Inu Metaverse project.
Although details about the Metaverse are sparse, that hasn’t stopped the Shiba Inu faithful from loading up on virtual land. In the few brief updates on the project from pseudonymous Shiba Inu developer Shytoshi Kusama, “SHIB: The Metaverse,” as it’s currently called, will be developed in partnership with a leading AAA game studio. However, according to Kusama, several non-disclosure agreements have prevented developers from revealing further details.
Other plans, such as developing the Layer 2 Shibarium network, also appear to be advancing. Blockchain development company Unification has been tasked with creating the new network, which will form the base layer for the Shiba Inu ecosystem. Blog posts from Kusama say the network will be “optimized for gaming” and offer lower fees and higher throughput than Ethereum.
According to a recent blog post from Unification Product Lead Maziar Sadri, Shibarium will launch its public beta later this year, allowing independent developers and users to fully interact with the network and participate in its validation process. Once fully launched, the SHIB token and all Shiba Inu-related NFTs will be migrated to Shibarium, and future ecosystem developments will launch directly on the new Layer 2 network.
However, it might be the planned mobile play-to-earn game that has Shiba Inu fans the most excited. Announced at the height of Shiba Inu mania in November 2021, development for the yet-to-be-named game is led by William Volk, a gaming industry veteran with more than 25 years of experience at top-tier companies such as Activision and ROKiT Games.
Like SHIB: The Metaverse, little is known about the Shiba Inu game beyond Volk’s involvement. The latest update from Volk came over three months ago when he posted an invite to an in-person meetup on Twitter, along with a teaser screenshot of art from the upcoming game.
Elsewhere, several tweets and blog posts from Kusama have dropped a few more breadcrumbs of information. The game will take the form of a collectible card game similar to Pokémon and Magic: The Gathering. More recent updates indicate that the Volk-led Shiba Inu Games and Australian studio PlaySide are both involved in the game’s development.
Although the play-to-earn aspect of the Shiba Inu game has not yet been revealed, there are several clues alluding to how it might work. In Kusama’s Jul. 6 blog post, they revealed that players would be able to earn a new token called TREAT through the game upon release. Kusama also hinted that several token sinks for TREAT would be woven into the Shiba Inu ecosystem. TREAT will “derive rewards for the Metaverse” and “help to provide balance to Shi,” the planned Shiba Inu stablecoin, they wrote. However, like most of Kusama’s posts, they gave no firm details on the token ecosystem besides stating that TREAT would “benefit current SHIB ecosystem holders greatly” and that the tokenomics would “not disappoint.”
Although Shiba Inu’s developers are dedicated to growing the token into a fully-fledged crypto ecosystem, several factors could stop them from achieving their vision.
While Shibarium and the collectible card game have spurred excitement within the Shiba Inu community, concrete details on what is being built and how it will work remain patchy at best. Information is often spread across multiple sources with no centralized hub keeping track of all the latest announcements.
Most of the information that can be found comes from Kusama after Ryoshi bowed out from the project earlier this year. Kusama’s posts are often casual, lack structure, and make bold assertions about the Shiba Inu ecosystem and its upcoming plans without offering specific details. As a result, Shiba Inu fans are left speculating about the details of highly-anticipated updates, creating confusion and fueling fear, uncertainty, and doubt from the project’s detractors.
For example, Kusama has said the Shibarium Layer 2 will not require ETH for its transaction fees and will instead use the Shiba Inu ecosystem governance token BONE to process transactions. However, according to the Shiba Inu whitepaper, BONE has a limited supply of 250 million tokens. It is currently only distributed to those participating in various staking and liquidity-providing activities on ShibaSwap, the official Shiba Inu decentralized exchange. Kusama’s posts have yet to reveal further details about how BONE will function as both a gas and governance token, leaving holders hoping for the best instead of being able to conduct proper due diligence into how the token system will function after the launch of Shibarium.
Dubious tokenomics aside, another worry is that many of the Shiba Inu ecosystem initiatives are copies of ideas previously pioneered by other crypto projects. Shiba Inu’s Metaverse offering will be in direct competition with those developed by well-funded companies such as Bored Ape Yacht Club creator Yuga Labs and Facebook owner Meta. An excess of smaller NFT projects have also tried copying the Metaverse playbook in their roadmaps, making the concept tired before even a single Web3-native Metaverse game has successfully launched.
Crypto gaming is also experiencing a downturn accelerated by titles like Axie Infinity and STEPN, two popular games that experienced a dramatic rise but plummeted as they failed to create self-sustaining token ecosystems. The current play-to-earn model, which Shiba Inu’s play-to-earn game is yet to differentiate itself from, requires a constant influx of new players to keep existing players interested in playing and is therefore unsustainable. It’s unclear whether the Shiba Inu collectible card game will be able to overcome this issue when it launches. Still, with so little information to work from, it’s proving difficult for crypto enthusiasts to get behind a project with so many unknown factors.
Lastly, the idea of a native stablecoin will likely be the most off-putting to the wider crypto community in light of the collapse of the Terra ecosystem and its algorithmic UST stablecoin. No information has been released explaining how the stablecoin will work or whether it will be overcollateralized. However, the little information available that alludes to the TREAT reward token playing a role in the stablecoin’s peg mechanism is not encouraging.
The bigger question is whether the Shiba Inu community is interested in stablecoins, complex token systems, and yield-generating opportunities. Shiba Inu’s early success relied on its memetic power and passionate community. From an outsider’s perspective, a game that prioritizes player engagement, community, and fun over the ability to make a profit could be more on-brand for Shiba Inu, especially while cryptocurrencies are stuck in a bear market.
However, it’s hard to deny that Shiba Inu is establishing itself as a serious crypto contender. A lot is happening behind the scenes, and it’s only a matter of time before a finished product hits the market. Still, if the project’s developers don’t consider what the project’s community really wants, what was once one of the biggest drivers of crypto adoption could end up as a forgotten meme of the past.
Disclosure: At the time of writing this feature, the author owned ETH and several other cryptocurrencies.
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