Shiba Inu (CRYPTO: SHIB) and Dogecoin (CRYPTO: DOGE) used to be similarly priced cryptocurrencies. But over the past year, Shiba Inu has been underperforming its rival meme coin, which has received a boost from the Department of Government Efficiency (DOGE) agency behind which is Elon Musk – its acronym is similar to Dogecoin’s symbol.
However, given its more modest valuation, Shiba Inu’s coin may be in a more favorable position to rally from here relative to its rival. But can it catch up with Dogecoin?
Can the recent Shibarium milestone accelerate the rally?
Shiba Inu launches its layer-2 blockchain, Shibarium, in August 2023, which was created to improve and enhance the processing of transactions. Recently, Shibarium hit 1 billion in transactions, a huge sign of its usage and adoption in the crypto community. Reaching the milestone could help show crypto investors that Shiba is more than just a meme coin and can be used in the real world.
While Shiba Inu's value hasn't surged on this development, the entire crypto market has been struggling in recent weeks due to concerns about the economy caused by tariffs and trade wars, which are impacting countries all over the world. As of Monday, leading cryptocurrency Bitcoin (CRYPTO: BTC) was down more than 15% since the start of the year, which is much smaller than Dogecoin's 53% crash and Shiba's 46% drop.
What could change things for Shiba?
If Shibarium's recent milestone isn't enough to fuel a rally, it might be hard to see anything else doing so at this point. But given Shiba's relatively low valuation – its $6.7 billion market cap is much lower than Dogecoin's $22.1 billion – it could make it a more attractive buy if enthusiasm for the crypto market picks up again.
Dogecoin has been a much-loved meme stock for some time now, but if there is less news about the DOGE agency and Musk steps down from his role with the government in the near future, that could lead to less attention being paid to Dogecoin. Without that, Shiba Inu and its lower valuation could make it a more attractive coin to buy.
And Shibarium's milestone could still prove to be a positive catalyst; unfortunately it happened at a time when many investors are angry with crypto markets, at least temporarily. Had it happened amid more enthusiasm, the results could have been more positive.
Can Shiba Inu Overtake Dogecoin This Year?
Things can change quickly in the crypto world. There was initially a lot of hope and excitement that President Donald Trump would implement crypto-friendly policies that could provide a big boost to crypto markets. Instead, things fell apart in recent months, when Trump launched his own meme coin. This sparked outrage in the crypto community, which believed the new coin would undermine the seriousness and legitimacy of the industry.
The good news is that when things change, they can change quickly in crypto. Shiba has struggled more badly than Bitcoin this year, but if excitement returns to the crypto market at some point this year, it could be well positioned to rally, thanks to its low valuation and the recent Shibarium milestone.
However, investors should be careful not to assume it can catch up to Dogecoin, or that it can even deliver positive returns. If economic conditions don’t improve and investors don’t feel good about the economy, there may not be much excitement around crypto. Cryptocurrencies are very volatile investments, and Shiba is by no means a slam-dunk buy at this point. While it may catch up to Dogecoin at some point, I don't expect it to be any time soon.
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