I saw a news report on Sept. 7 that said Shiba Inu (CCC:SHIB-USD) was struggling to remain above its support level at 0.000007 cents.
This is the first time I’ve had the opportunity to write about the cryptocurrency named after a Japanese hunting dog breed. However, due to Dogecoin’s (CCC:DOGE-USD) rising popularity, and to a lesser extent, Shiba Inu’s crypto prominence, the demand for the breed has skyrocketed, putting the breed’s welfare in question.
I don’t know about you, but the last thing I want to be associated with is an organization responsible, directly or indirectly, for the inhumane treatment of animals.
For this reason, I could never own Shiba Inu.
However, from a practical investment standpoint, I have a hard time taking a cryptocurrency seriously that makes you think twice about how many zero’s you’ve typed out for its token price.
For this reason, I could never take Shiba Inu seriously. Here’s why.
Shiba Inu Hits a Penny
According to CoinMarketCap.com, Shiba Inu is the 54th-largest cryptocurrency with a market capitalization of $2.71 billion. Of the 53 cryptos ahead of it by market cap, only BitTorrent (CCC:BTT-USD) has a price below a penny.
Now, I understand it doesn’t matter in this day and age of fractional investing whether a cryptocurrency trades for $1 or 1 cent or 1/10th of a cent. It’s the total investment that counts.
If Shiba Inu was to trade at a penny, then perhaps, I might take it more seriously. As it stands, there are too many other players ahead of it in the top 10 alone, including DOGE in the eighth spot by market cap. But it at least has some utility while trading around 29 cents.
A Lottery Ticket Might Be Better
My InvestorPlace colleague, Josh Enomoto, recently discussed the idea of buying Shiba Inu. My colleague is one of the few InvestorPlace contributors that has put his money where his mouth is and reaped a significant reward for doing so. He paid off the mortgage on his house.
There aren’t many bigger achievements in a regular person’s life than paying off their mortgage early. I continue to shake my head in amazement. But as Enomoto freely admits, he was simply lucky.
Don’t get me wrong. I consider him to be one of the most analytical writers at InvestorPlace. But, if anyone could make a killing at cryptocurrencies, it would be him. Enomoto has the mind for understanding intangibles.
As it relates to Shiba Inu, my colleague doesn’t believe it makes sense to own the cryptocurrency. But if you do decide to buy, do so on Friday when it tends to lose upwards of 5% of its value, the biggest loss of any day of the week.
“While this is absolutely not financial nor tax advice, if I were you (which I’m not because I’m not buying Shiba Inu because it’s too risky), you might want to convert your SHIB holdings into stable coins as opposed to U.S. dollars if you intend to trade frequently,” Enomoto wrote on Sept. 3.
“What’s most fascinating, though, is that Shiba Inu performs well over the weekend on an average basis. This contrasts with observations that CNBC made this year, that cryptocurrencies tend to crash on weekends.”
The Bottom Line
Enomoto is definitely right that Shiba Inu has become a cryptocurrency for weekend warriors who don’t have time during the workweek to speculate on SHIB-USD and other low-priced cryptos.
While he does admit he’s not buying Shiba Inu because it’s too risky, he does provide the helpful advice that frequent traders park their funds in stable coins rather than U.S. dollars to avoid volatility.
For me, I can’t take something that trades for 0.000007 cents seriously. Perhaps my opinion will change as I become more familiar with Shiba Inu. Then again, I’m more likely to take in a Shiba Inu rescue dog than buy the cryptocurrency.
That’s just the way I roll.
On the date of publication, Will Ashworth did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Will Ashworth has written about investments full-time since 2008. Publications where he’s appeared include InvestorPlace, The Motley Fool Canada, Investopedia, Kiplinger, and several others in both the U.S. and Canada. He particularly enjoys creating model portfolios that stand the test of time. He lives in Halifax, Nova Scotia. At the time of this writing Will Ashworth did not hold a position in any of the aforementioned securities.