INTRODUCTION
Shiba Inu has been called the 'Dogecoin' killer by many in the cryptosphere, but what are the differences between the two? In this subsection of the Shiba Inu Coin Guide let's compare what the major differences are between the two.
COMPARING SHIBA INU AND DOGECOIN
- One glaring comparison between these two assets relates to the nomenclature attached to each. Dogecoin is a 'coin' whereas Shiba Inu is a 'token'. While it is true that the terms 'coin' and 'token' are sometimes used interchangeably, there does exist a distinction between the two terms. A 'coin' is built upon its own blockchain, whereas a token is built on top of an existing blockchain. As such, Dogecoin exists upon its own blockchain whereas Shiba Inu is built upon the Ethereum blockchain.
- Dogecoin's blockchain is ultimately a fork from the Bitcoin blockchain (by way of the Litecoin blockchain which was also a fork of Bitcoin). As noted, Shiba Inu is built on the Ethereum blockchain and as such is subject to Ethereum's network congestion problems as well as it's high transaction fees. Shiba Inu is also subject to the Ethereum blockchain's development decisions and therefore will have to comply with the on-going Ethereum upgrade (Ethereum 2.0). This is absent in Dogecoin.
- Relative to the above, Dogecoin is a Proof of Work network and while Shiba Inu being Ethereum based is presently Proof of Work, it is transitioning into a Proof of Stake network with the advent of Ethereum 2.0.
- Although Dogecoin shares many characteristic with Bitcoin, Bitcoin has a capped supply of 21 million coins but Dogecoin has no such cap and therefore is unlimited in supply. Shiba Inu does have a capped supply, however, it is an extremely high cap, even in cryptocurrency terms. The supply cap for Shiba Inu was originally 1 Quadrillion tokens, after token lock ups and token burns, the current circulating supply of the token is now 394,796,000,000,000,000 tokens. (It can not be said by any stretch that there is scarcity associated with either of these coins).
- Both coins have solid community support. Dogecoin has it's Doge Army and Shiba Inu has a corresponding SHIB Army. Market capitalization for Dogecoin at the time of this writing is a hefty $26,756,618,663 USD ranking it 8th on the list of cryptocurrencies ranked. By comparison. Shiba Inu's market capitalization at the time of this writing is $2,503,439,226 USD, ranking it 39th on the same list. Nonetheless, these are huge numbers for assets that got their start as jokes.
- Dogecoin gets its hype from billionaire Elon Musk who has pledged his support in working to improve the efficiency of the coin for payment purposes. This to a great extent has fueled retail interest in Dogecoin. Shiba Inu, on the other hand, is extremely popular with Chinese retail investors which has fueled its market hype and price. The SHIB token also has links to a celebrity of sorts, Vitalik Buterin, who after he was gifted 1/2 of Shiba Inu's issued tokens, donated some to charity and burned the rest.
- There is a large disparity in the transaction costs associated with these two assets. As of June 7, 2021, "[i]n terms of shipping fees or gas, SHIB cryptocurrencies are charged 0.0019 ETH or 5.32 US dollars, while DOGE delivery fees are only 2.48 DOGE or 0.933 US dollars." [VOI. "Want To Buy Dogecoin Or Shiba Inu? Here's A Comparison Of The Two". (Accesseed July 26, 2021)].
- Dogecoin was released in December, 2013 and is now 7 years old. By comparison, Shiba Inu is a mere 10 months old.
- From a project standpoint, Dogecoin at this time appears to be focused on unspecified ways to improve the coin and its efficiency as a vehicle of payment. Shiba Inu, on the other hand, has recently launched its DEX known as ShibaSwap, and has several other specified projects in its pipeline.
CONCLUSION
It can not be said that either of these two assets are fundamentally strong but both have captured the interests of the cryptocurrency market. It seems retail investors are disregarding fundamentals in investment decisions on these two assets, choosing instead to yield to market hype and potential price appreciation.
With that said, remember, both Dogecoin and Shiba Inu started out as nothing more than joke coins.
The preceding lists comparisons are presented for educational purposes only. They should not be considered investment advice. As always, before investing any of your hard earned assets, do your own research diligently. And remember, especially with a speculative token like Shiba Inu, never invest more than you can afford to lose.
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