Why Meme Coins Like Shiba Inu Are Bad For Crypto!
A lot of millionaires were probably made over the past week from buying Shiba Inu. I can see them right now checking their accounts saying “SHIB to the moon!”. Also, thinking this is the Dogecoin killer I’m going to HODL (hold on for dear life) until a dollar. They will be disillusioned and a lot of factors that play into their thoughts are major problems for beginners and novices entering into the crypto market.
Subscribe to Coinmonks Youtube Channel to get daily crypto news.
I know we all remember Elon Musk naming himself the ‘Dogefather’ ahead of a Saturday Night Live appearance. Then later goes on to say during the show “…it’s a bit of a hustle.” During all this meme coin mania people on social media were raving about “Doge to the moon” and “I’m going to be rich when it hits the price of Bitcoin”. All of which are somewhat dream thoughts for many reasons. For starters, Dogecoin was created as a joke by Billy Markus and Jackson Palmer, two software engineers, to differentiate their coin from Bitcoin.
Do they have use cases?
Most meme coins have no utility besides transferring from person to person. The natural response to that is “Bitcoin does the same thing”. Most would agree but, they forget to factor in Tokenomics (math and economics). There will only ever be 21 million Bitcoin and the last block is projected to be mine in 2140 maybe sooner if quantum computing comes into fruition. Meme coins have horrible tokenomics.
For instance, every time a Doge block is mined 10k DOGE is rewarded to the miner, and 1 block is mined every minute. You do the math on that!
Even with Shiba Inu, the total token supply started at 1,000T meaning for it to ever hit a dollar the world would have to put a QUADRILLION dollars in its market cap or $1Trillion about 1,000 times. (Update half a quadrillion token cap because of token burning)
How probable is that?
Shib tried to alleviate the tokenomics problem by burning tokens. Token burning introduces another problem of integrity with meme coin aka “$h*tCoins”.
Crypto was created to have a set amount unlike fiat currencies controlled by governments that print at will. Token burning is akin to starting a game with one set of rules and mid-way through changing the rules of the game.
Back to the “Dogefather and Friends”
Elon isn’t the only one raging about meme coins. Mark Cuban was on the Doge-train too allowing the Dallas Maverick’s to accept Doge a payment for tickets. I’m not a complete hater because any adoption of crypto into the mainstream is appreciated. These two though, have a notorious past for manipulating markets to their benefit.
Both Cuban and Musk have a history with the SEC in what can only be seen as shady manipulation.
- Mark Cuban v. SEC- “The SEC claimed Cuban used insider information he received from Mamma.com CEO Guy Fauré to avoid a $750,000 loss by selling all of his shares in the company one day before it announced a private stock offering, which diluted the value of the shares.
- Mark Cuban also sold broadcast.com for $5 billion to Yahoo.com only for it to be shut down within 2 years.
- Elon Musk and SEC- “According to the SEC’s complaint against him, Musk tweeted on August 7, 2018 that he could take Tesla private at $420 per share — a substantial premium to its trading price at the time — that funding for the transaction had been secured, and that the only remaining uncertainty was a shareholder vote.”
I want to clarify, they are extremely amazing entrepreneurs and businessmen. Nevertheless, that doesn’t make them immune from throwing their billions around in low market cap meme coins. They have the notoriety and following to get mass amounts of money and people of all types to take their advice in the crypto space. It’s reminiscent of the mid ’90s at the beginning of the internet when stock traders created a website giving people advice to buy a stock then dumping it. The classic pump and dump! There is evidence the “Dogefather” is doing this with DOGE and as of the last couple of Days SHIB! Crypto is a good place to make massive gains and losses, but it can be manipulated when Billionaires can become Whales with massive transfers of money.
This is all bad for the crypto space. I’ve been watching its growth since 2011, lost Bitcoins to the Bitconnect scam, and lost a lot of value after 2017. One thing I have noticed through all of that is crypto relicenses remain undefeated. The community aspect of it has a good way of weeding out bad actors for the maturation of the industry as a whole. I wrote this to help people understand the importance of doing due diligence before investing in something you don’t know much about. Rug pulls or, dumps, or getting REKT happen all time, especially without official regulation.
If you want more information on all things Crypto click the follow or follow me on
- If you enjoyed this, SUBSCRIBE to my Medium for exclusive content!
- Likewise, you can also FOLLOW me on Medium
- Follow me on LinkedIn for other content
- Grid Trading Bots | Cryptohopper Review | Bexplus Review
- 7 Best Zero Fee Crypto Exchange Platforms
- Decentralized Exchanges | Bitbns FIP | Pionex Review
- 10 Best Places to Buy Crypto with Credit Card
- Crypto Copy Trading Platforms |How to buy Bitcoin on WazirX
- CoinLoan Review | Crypto.com Review | Huobi Margin Trading
- Bookmap Review | 5 Best Crypto Exchanges in the USA
- The Best Crypto Hardware wallet | Bitbns Review
- 10 Best Crypto Exchange in Singapore | Buy AXS
- Best Crypto to Invest in India | WazirX P2P
- Best Crypto Trading bots in Canada | KuCoin Review
- Crypto Trading Signals for Huobi | HitBTC Review
- How to trade Futures on FTX Exchange | OKEx vs Binance
- OKEx vs KuCoin | Celsius Alternatives | How to Buy VeChain
- Binance Futures Trading | 3Commas vs Mudrex vs eToro
- How to buy Monero | IDEX Review | BitKan Trading Bot
- YouHodler vs CoinLoan vs Hodlnaut | Cryptohopper vs HaasBot