The Shiba Inu cryptocurrency token and its entire ecosystem is an interesting use case. The Shiba Inu token was launched in response to the rise of another meme cryptocurrency: Dogecoin. In fact, the supporters of Shiba Inu have often dubbed the token as the Doge killer.
The Shiba Inu cryptocurrency is an ERC-20 token that is the pioneering currency of the Shiba ecosystem that spans a decentralised exchange (ShibaSwap) and an NFT market in the works. Let’s discuss and find out why the Shiba Dao is such exciting news for the holders of SHIB.
What is the Shiba Inu Ecosystem?
The Shiba Inu ecosystem comprises three tokens:
- SHIB- the first token launched by the Shiba ecosystem. It had a supply of 1 quadrillion but half of it was donated to Vitalik Buterin (founder of Ethereum) who burned 40% and donated the rest to the India Covid-19 relief effort.
- BONE- the governance token for the Shiba Dao or the Doggy Dao which in turn governs the ShibaSwap exchange and the larger Shiba ecosystem. The total supply is 250,000,000.
- LEASH- It has a supply of 107,646 tokens and was conceptualized as a rebasing token but the plan was shelved later.
All three tokens can be staked and used to provide liquidity that helps users in earning a passive source of income. The ShibaSwap exchange is an important part of the Shiba Inu ecosystem.
Most meme coins including DOGE suffer from a dilemma. What problem do they solve and what use case do they have? Beyond the simple use of a payment currency, most meme tokens are worthless and not even worth a penny. Most of them will eventually fizzle out and are considered rug pull schemes primarily because they are unable to provide a clear utility. This is why Shiba Inu is such a powerful cryptocurrency and ecosystem. It has been successful in developing an interesting use case in the form of the ShibaSwap exchange.
So, this was a historical look at the Shiba Inu empire but what about the Shiba Dao and why is it in the news?
The fundamental core principle of any cryptocurrency is complete decentralization. In fact, cryptocurrencies were invented to end the strict government control on fiat currencies. However, meme cryptocurrencies such as SHIB often face frequent criticism- they claim to be decentralised but are usually controlled by a few token holders with deep pockets who are known as whales. This takes away the decentralized part of the cryptocurrency ecosystem as the whale can manipulate the price either by dumping the tokens or by purchasing huge amounts. The whales also tend to rally and sway community decisions in their favour because of their large share of the voting power. A community-based DAO can often bring in true decentralization. This is what the Shiba ecosystem is trying to achieve and if it can guarantee the success of its DAO, it might help in further boosting the fortunes of the ShibaSwap exchange as well as the associated cryptocurrency SHIB.
The Shiba DAO or the Doggy Dao was announced on December 31, 2021, via a blog release by the Shiba Inu team.
The first phase of the Shiba Dao will allow token holders to stake their BONE tokens and use them to vote for pairs on the ShibaSwap DEX. It will help to determine which pairs will be allocated to the WOOF Pools. It will help in distributing power to the community that will help in deciding the future of the ShibaSwap DEX. The BONE rewards or allocation points will be distributed as per the decision of the community decided by the voting process.
The whale activity will be limited by providing the final say with the 6/9 guardian wallets.
The Shiba Dao will use tBONE or the staked form of the BONE token for carrying out the voting process. The rewards or allocation points will remain in place for a total of 14 days after which the next round of voting will decide the next 30 pairs (from a total of 50 choices) for the WOOF pools and so on.
The Shiba Inu token has already seen a mammoth rise and has appreciated in price from an all-time low of $0.000000000056 on 28 November 2020 to an all-time high of $0.00008616 translating into mind-boggling returns of 60264132.5% as per CoinGecko. These are impressive numbers and cannot be rivalled by traditional investment instruments. The Shiba Inu token was trading at $0.00003393 at the time of writing. Plus, you could make a passive income if you decide to stake your tokens. How cool is that!
If the Shiba Dao governance mechanism proves to be a success, it could further propel the price of the SHIB token and its associated value could also skyrocket. The Shiba Inu team has promised to take things forward by introducing further complexities in the process which will form phase 2 of the DAO implementation program.
Shiba Inu remains the meme coin with a use case making it a rare token among the many copy-paste cryptocurrencies that are being launched every day.