Shiba Inu Gains 25% in Feb 2022 – but are memecoins a safe investment?

Shiba Inu hit an all-time-high market cap. But are memecoins a safe crypto investment for 2022?

Memecoins are built on hype – and there’s been enough this year to see significant gains in Shiba Inu (SHIB). Shiba Inu’s growth has outperformed that of fellow memecoin Dogecoin (DOGE), which with a market cap of $20 billion sits a little higher in the crypto rankings than Shiba Inu’s $16.8 billion market cap. Metaverse announcements, merchant adoption, and major events all drove up Shiba Inu’s price in January and February 2022.

But are memecoins a safe crypto investment for 2022? Shiba Inu hit an all-time-high market cap of nearly $40 billion in October last year with prices 158% above where they are now. There’s potential for more growth, but also potential for volatility. In this article, we’ll compare the memecoin Shiba Inu with another cryptocurrency that offers investors something a little different, EverGrow.

Shiba Inu (SHIB) bites back

Shiba Inu jumped into 13th place in the cryptocurrency market cap rankings, with a valuation at $18 billion, in early February. That put it right behind rival memecoin Dogecoin, both of which are based on internet memes about dogs. But where Dogecoin only saw 11% MTD (month to date) gains, Shiba Inu saw 50% MTD gains coming into February 2022.

Most of these gains can be traced to two dates: February 6 and 7. SHIB’s price jumped an impressive 41% on these dates following positive announcements and hype. 

On February 3, Welly’s fast-food chain selling hamburgers and french fries announced a Shiba Inu re-brand. This included Shiba Inu-themed products, including NFTs, as well as allowing SHIB as a payment option. A day after the announcement SHIB’s price rose 7%.

Later, on February 5, crypto business Bigger Entertainment announced 162 million SHIB will be burnt on Valentine’s Day. This will drive up both scarcity and price in Shiba Inu. On the same day, the blockchain solutions firm Unification, from Singapore, announced the development of a layer-2 solution called Shibarium. The Shibarium will be optimised for gaming, in cooperation with Shiba Inu creators. 

While Shiba Inu received all this attention, Dogecoin has traded much more modestly following its moment in the spotlight: on January 14 when Elon Musk announced Tesla was accepting DOGE as payment for merchandise. DOGE rallied to $0.2148 after the Tesla news but has since dropped to nearly $0.15.

SHIB comes with its own risks. To begin, the token’s boom has done little to improve its use case outside cryptocurrency exchanges. For example, Cryptwerk, an online crypto directory, shows that 618 merchants globally accept payments in SHIB. To compare, more than 2,000 merchants have integrated DOGE into their checkout page.

The issue is that memecoins are just that – memes. They have their moment on the Internet and then attention goes elsewhere. One growing movement in the crypto industry is to look at cryptocurrencies with stronger utility and fundamentals, that can survive bearish cycles and mature into strong crypto investments. One of the rising examples of this is EverGrow(EGC).

EGC is newer than Shiba Inu (EGC launched in September 2021) but it quickly neared a market cap of $1 billion within months. The project is a hyper-deflationary token with passive income rewards built into the fundamentals. All profits are put towards buying back and burning EGC tokens, driving up scarcity and prices as part of its functioning. 

As all Token transactions are taxed, this sees 8% redistributed to over 130,000 coinholders in Binance pegged USD (BUSD). To date, the crypto has paid out over $34 million to investors, who don’t need to do anything to see the BUSD deposited in their wallets. The top team of developers and finance professionals behind EverGrow is also moving into P2E gaming, building an NFT marketplace, a wallet, staking pools, and a crypto-integrated social media platform, Crator. 

EverGrow has seen spikes of 127% in value in 2022 already, and with strong fundamentals as the foundation of its crypto project analysts are predicting that it could be a newcomer in the top 20 cryptos this year.

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