Shiba Inu ( SHIB 1.63% ) hasn’t lost its bite after all. The meme coin has picked up positive momentum in recent days. This rebound is much needed after Shiba Inu lost more than three-quarters of its value over the past five months.
But is the recent move higher only a dead-dog bounce? Not necessarily. Here’s why Shiba Inu could double by the end of 2022.
Danish physicist Niels Bohr is often credited with the quip, “Prediction is very difficult, especially about the future.” But you won’t have to look hard to find plenty of prognosticators online willing to give their views on Shiba Inu.
Gov Capital uses an artificial intelligence (AI) algorithm. Its AI predicts SHIB will soar close to 250% by the end of this year. Even better, Gov Capital forecasts that the meme coin will more than quadruple within the next 12 months.
WalletInvestor.com, which has been predicting cryptocurrency prices since 2017, also uses AI in its forecasting algorithms. It projects that the digital token’s price will reach $0.0000539 by year-end. That’s a gain of nearly 93% from the current level. Just a little extra push could enable Shiba Inu to double this year.
CoinPriceForecast thinks that Shiba Inu will end 2022 up more than 60% and will gain 144% by the end of 2023. Again, it likely wouldn’t take much acceleration of CoinPriceForecast’s projection for the meme coin to double sooner rather than later.
Behind the optimism
You and I might be tempted to dismiss rosy predictions from internet sites that don’t have skin in the game. But it’s a different story for investors with deep pockets who are betting heavily on Shiba Inu.
Just last week, a crypto whale bought more than 200 billion SHIB tokens. This anonymous person purchased more than 3.7 trillion tokens several days earlier. The position is worth more than $80 million. Now that’s skin in the game. And there are other whales loading up on Shiba Inu as well.
What’s behind all of this optimism? I think there are several factors, but three that especially stand out.
First, the overall cryptocurrency market is improving. It wasn’t just Shiba Inu that plunged in recent months. Bitcoin and most altcoins fell significantly as well. Shiba Inu will have a much easier path to doubling in a booming crypto market than it would otherwise.
Second, Shiba Inu’s focus on burning tokens is attracting renewed interest among investors. There was definitely some enthusiasm after NOWPayments announced last week that it will enable merchants to specify thresholds for burning SHIB tokens.
Third, Shiba Inu has a couple of high-profile additions to its ecosystem on the way. Shibarium is a much-anticipated layer-2 solution that will slash gas fees. Shiberse is a metaverse that could position Shiba Inu to compete against top crypto metaverses including Decentraland and The Sandbox.
It’s not far-fetched whatsoever to think that Shiba Inu could double by the end of 2022. However, investors should recognize the risks associated with investing in the meme coin.
There’s no guarantee that the current crypto bounce will have legs. Shiba Inu’s burning emphasis might not make a significant impact, especially considering there are more than 549 trillion tokens in circulation. It’s possible that Shibarium and Shiberse won’t live up to investors’ lofty expectations.
I think that the quote commonly attributed to Niels Bohr needs some tweaking. Predicting isn’t very difficult. But predicting with accuracy is.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.