Meme token has lost more than 90% of its all-time high value.

The total value of all existing cryptocurrency tokens tracked by CoinGecko currently stands at $ 1 trillion. This is 66% lower than the all-time high of $ 3 trillion achieved during the speculative frenzy in 2021. However, some tokens have experienced an even steeper decline, and Shiba Inu (SHIB 1.68% ) is one of them .

The token increased by 43,800,000% in 2021, providing one of the most lucrative one-year returns in history. In other words, a perfectly timed investment of just $3 could make you a millionaire. But the current picture looks very different because Shiba Inu has steadily lost 91% of its value at an all-time high.

So could another spectacular run be on the cards? Believe it or not, there is a mathematical probability that #Shibainu will increase from its current price of $ 0.000007 to $1. But this does not necessarily mean a life-changing chance. Let me explain.

Shiba Inu fails adoption test

First of all, we need to investigate why Shiba Inu has lost so much value in the last two years. Cryptocurrency in general has had a difficult time fulfilling its promise of becoming a decentralized alternative to traditional money. Even the largest token, Bitcoin, is accepted as pay by only 8,120 businesses worldwide, and only 770 of them are ready to accept Shiba Inu.

Volatility is one reason why businesses are not embracing crypto; any pay tool that can fluctuate by millions of percentage points before losing almost all of its value will make cash flow management almost impossible. The bottom line is this: if consumers can't spend their tokens on everyday goods and services, then there's not much reason to buy and hold them, except for a claim that their value will increase.

Investor sentiment remains low

The risk of catastrophic financial losses is another reason why investors have been staying away from cryptocurrencies recently. 2022 was marred by extraordinary failures in the industry, and in November, this drama reached its peak with the collapse of the leading crypto exchange FTX. About $3 billion of customer money is still missing, and there is little hope of getting that money back.

Of course, some crypto enthusiasts will argue that banks in the traditional financial system also sometimes fail, and he certainly supported this point with the collapse of Silicon Valley Bank this year. But no customers suffered financial losses because deposits up to $250,000 are automatically insured by the Federal Deposit Insurance Agency (FDIC), and the U.S. government stepped in to protect larger depositors, most of whom are commercial.

These safety nets do not exist in the decentralized world of cryptocurrency, and the last two years are a reminder that living within the boundaries of a regulated financial system brings benefits. For this reason, it is not surprising that investors are staying away from speculative tokens such as Shiba Inu, but this does not mean that its price will not increase from here.

There is a mathematical obstacle that prevents Shiba Inu from reaching $ 1

There are currently 589.3 trillion Shiba Inu tokens on offer, and the market value of the ecosystem is $ 4.6 billion, with the price of each of them being $ 0.000007. Mathematics shows that if the price of a Shiba Inu token rises to $ 1, the market value of the ecosystem will be $ 589.3 trillion. This will be equal to:

203 Apples (the company, not the fruit, is worth $ 2.9 trillion)

23 American economy (U.S. gross domestic product exceeded $ 25.4 trillion in 2022)

1.3 Planet Earth in terms of wealth (the total value owned by all consumers, governments and businesses at the end of 2022 was $ 463 trillion)

As you probably understand, it is absolutely and absolutely impossible for Shiba Inu to reach $ 1 in its current form.

Here's how to get to $1

The Shiba Inu community has become aware of the supply problem and is trying to solve it by "burning" the tokens, removing them from circulation forever. Investors can participate by sending some of their tokens to a dead wallet, where they will never be recovered. Enthusiasts can also help by posting a specific music playlist or using the Sh Dec Search internet search engine. Part of the proceeds from both activities are used to burn Shiba Inu tokens.

Theoretically, when the supply decreases, the price of Shiba Inu tokens will increase organically. The problem is this: in order for Shiba Inu to reach $ 1 through this mechanism, the community will have to burn 99.99998% of all tokens in the supply. This means the elimination of more than 589.2 trillion tokens.

On September 2, when I wrote this article, 116 million tokens were burned. If this rate remains constant, about 42 billion tokens will be burned this year. This means that it will take more than 13,900 years to burn enough tokens to send Shiba Inu for $1

It's getting worse. Even if the community burns through the 589.2 trillion tokens needed to send Shiba Inu for $1, the ecosystem's market value will still be $4.6 billion. This application will not increase the value of the token, which means that no investor will really be able to make money.

This is because each investor will have to burn 99.99998% of their own tokens to achieve the common goal, so ultimately, they will have fewer tokens worth a higher price per token; holdings.

So, although it is technically possible for Shiba Inu to reach $1 at some point in the future, this will not necessarily translate into a financial gain! #crypto2023 #Binance