Education • 5 min read
By Brinsley Bailey
Finding any correlation between cute dogs and currency trading may have seemed peculiar in the past, but since the advent of dog-themed cryptocurrency, it’s no longer a far-fetched association. We explore the origins of Dogecoin and Shiba Inu, what they have in common, where they differ, and which meme coin has the brightest future.
Dogecoin was founded by software engineers Billy Markus and Jackson Palmer in December 2013. It was created as a fork of Litecoin, which is itself a fork of Bitcoin. You could even say that Dogecoin is a fork of a fork of Bitcoin!
Shiba Inu is an ERC20 token founded more recently than Dogecoin, in August 2020 by Ryoshi, a mysterious individual or group - nobody knows how many people are actually involved really, though many speculate it is just one person.
Let’s start with the basics: coins and tokens aren’t synonymous terms in crypto. While coins run on their own dedicated blockchain, tokens are built on top of other blockchains.
One main difference between SHIB and DOGE is that the first is a token while the latter is a coin. As things stand today, SHIB doesn’t have its own blockchain but instead runs on Ethereum, being an ERC20 standard token. DOGE, on the other hand, is built and runs on its own blockchain, making it a coin.
The use cases of cryptocurrencies can vary. With both Dogecoin and Shiba Inu, the main use case is employing these cryptos as a payment method. SHIB can also be used to mint land in the Shiba metaverse.
Both Dogecoin and Shiba Inu have been accepted as payment methods by many companies: Gucci recently started to accept crypto payments in selected US stores, AMC Entertainment* announced its decision to embrace Dogecoin and Shiba Inu, but also Chipotle*, Shopify*, Balenciaga and many more.
After some back and forth, Tesla* also decided to allow payments in DOGE on certain products, and SpaceX might soon follow.
Dogecoin and Shiba Inu make use of the same type of consensus algorithm: Proof of Work. As we said before, Dogecoin has its own blockchain and the consensus employed is PoW. Shiba Inu relies on Ethereum’s consensus algorithm, which is still PoW - though it is scheduled to be substituted by Proof of Stake with the full integration of Ethereum 2.0.
Proof of Work isn’t a very environmentally friendly consensus algorithm, as it requires large amounts of energy and generates significant CO2 emissions.
The crypto market is known for its volatility, therefore past performances can’t be considered indicative of future performances.
Since their launches, there have been notable price developments for both DOGE and SHIB. Since Shiba Inu is relatively new, less data is available about SHIB compared to DOGE.
Dogecoin reached its all-time high on May 8, 2021 at €0.73 and its all-time low on May 7, 2015 at €0.00008.
Dogecoin’s first significant surge started last year. Before that, especially between 2017 and 2022, DOGE hovered around €0.003 and €0.001. As many other cryptocurrencies, DOGE had some setbacks between 2018 and 2019: at that time, Bitcoin’s price was oscillating between €11,000 and €3,000. Holders of the coin - or hodlers - had to power through very uncertain times before seeing some profits, with some even becoming “Dogecoin millionaires”.
Shiba Inu’s all-time low dates back to September 1, 2020 at €0.000000000082, while its all-time high took place a little over a year after that, on October 28, 2021 at €0.00008845.
Shiba Inu’s year was certainly 2021: the memecoin saw quite a steady increase during October, followed by a steep fall in the following months.
…the one more valuable for you.
If you believe the metaverse will be the next big thing, maybe SHIB would suit your investment strategy better, as the project is developing its own dog-themed metaverse.
On the other hand, if you’re leaning towards crypto you can use in your real-life purchases, then DOGE has more use cases for you as of today.
Keep in mind that things change fast in the world of cryptocurrencies and investing, so not all investments might be always good investments for everyone.
Whatever you decide to do, get your research done and consider your investment strategy before you start investing in any asset, including Dogecoin and Shiba Inu. Remember to take into account portfolio diversification and your personal risk tolerance: if you let FOMO and impulsivity take investment decisions for you, especially in turbulent times, you might end up barking at the wrong tree.
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The information shared in this article does not constitute investment advice. Investing carries risks. Make sure to conduct your own research before concluding a transaction. *Stocks and ETFs are the underlying assets of the contracts offered as Bitpanda Stocks and are brought to you by Bitpanda Financial Services GmbH. More information about the product is available at bitpanda.com. For more details, consult the prospectus available at bitpanda.com.
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