Raise the Woof: A Guide to the Shiba Inu Ecosystem
It's hard to take dog coins seriously, but is Shiba Inu more than just a meme?
Updated Apr 20, 2022
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Why do we invest? Sure, making money is nice, but not everyone sees capital gains as the end-all-be-all of investing. Unorthodox investing doesn't necessarily mean buying into risky alternative assets, but could also mean buying into a narrative that retail investors are not beholden to the financial paradigm. This vague stick-it-to-the-man ideology is the impetus behind Shiba Inu, a cryptocurrency that literally started as a joke.
What is Shiba Inu crypto?
What is Shiba Inu crypto?
Shiba Inu is a cryptocurrency ecosystem on Ethereum that includes a centralized exchange, a metaverse project, and the native SHIB token. SHIB is an ERC-20 token created in August 2020 by the pseudonymous "Ryoshi" as the Ethereum counterpart to competing dog-based 'meme coin' called Dogecoin (DOGE)—SHIB was dubbed the "Dogecoin killer."
Since ShibaSwap and the Shiba Inu ecosystem is decentralized, it's governed by a decentralized autonomous organization known as Doggy DAO.
Shiba Inu ascended in popularity in October 2021 when it reached an all-time high after the price rose over 10x. Being entirely community-driven, SHIB's success as a top-20 cryptocurrency is owed to the sheer will of the 'SHIB army' rallying around the project. The rapid rise of SHIB can also be owed to the cultural relevance of the meme surrounding the Shiba Inu dog breed and the early listing of the Shiba Inu token on major cryptocurrency exchanges.
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SHIB has grown to be the #15 cryptocurrency with a total supply of over 589 trillion tokens with over 93% in circulation, according to CoinMarketCap (which varies from CoinGecko's listing of the total SHIB supply as 1 quadrillion). However, the caveat to this is that 45% of Shiba Inu's supply was burned—or removed from circulation—by Vitalik Buterin after he was given half of all SHIB tokens, and the Ethereum founder used the remaining 5% to donate to pandemic relief in India.
Although the Shiba Inu price is extremely low, with an all-time high of just $0.00008 according to CoinMarketCap, Shiba Inu crypto has a market capitalization of over $14 billion, placing it right in between Polygon (MATIC) and Terra (LUNA) in terms of size. While SHIB crypto has limited utility, the community-run project's upcoming developments are trying to change this.
What is Shibaswap?
What is Shibaswap?
ShibaSwap is a decentralized exchange (DEX) similar to Uniswap and Pancakeswap but with an added feature that helps keep the ecosystem decentralized. The two main functions of DEXs like ShibaSwap are swapping, (or trading one crypto for another crypto for a small fee), and providing liquidity, (which means staking two cryptos to enable traders to freely swap between those cryptos in exchange for the fee).
In order to keep centralized crypto exchanges from reaping the rewards meant for liquidity providers, ShibaSwap implements a blacklist—or "GRRR" list—of crypto wallets controlled by "unaffiliated exchanges." This presumably refers to centralized exchanges with large SHIB supplies like Coinbase and Robinhood, however, this is not explicitly clear.
Like other DEXs, ShibaSwap users can provide liquidity to earn rewards. This feature is called "dig" and in order to start digging, you will need to provide an equal dollar amount of any two ERC-20 tokens. This will grant you a ShibaSwap Liquidity Pool (SSLP) token representing your share of the liquidity pool and rewards in the form of fees and the BONE token.
Liquidity providers can subsequently stake their SSLP tokens for additional rewards. While this is colloquially known as 'liquidity pool' farming, it is called 'Woof reward' in the Shiba Inu ecosystem. Holders of certain SSLP tokens can stake them to earn BONE rewards in addition to the trading fee collected from each swap transaction.
BONE is another token in the Shibaswap ecosystem that is used as an incentive for liquidity providers to contribute their tokens to the DEX. Unlike SHIB, BONE is much more scarce with a maximum supply of 250 million, thus explaining its higher price.
Users can earn 0.05% of all ShibaSwap exchange fees by "burying" or staking BONE and holding tBONE—the derivative token of staked BONE. Additionally, new BONE tokens are minted every transaction block, with 1% of that being distributed to tBONE holders. tBONE is also the governance token of the ShibaSwap ecosystem.
The last token in the Shiba Inu ecosystem is LEASH, which doesn't serve any purpose other than being extremely scarce, with a total supply of just 107,647. Like with BONE and SHIB, the 'bury' function allows token holders to stake LEASH and earn rewards. LEASH stakers receive xLEASH, which earns them 0.1% of all ShibaSwap trading fees and 1% of all newly-minted BONE tokens.
ShibaSwap users can also bury SHIB on the platform and earn rewards by holding the subsequent xSHIB token. In addition to 3% of all BONE minted every transaction block, xSHIB holders earn 0.5% of all platform fees and 0.1% of all fees generated by liquidity pools that include ETH. So, despite being the most abundant token in the ShibaSwap ecosystem, staking SHIB arguably reaps the best rewards.
Since ShibaSwap and the Shiba Inu ecosystem is decentralized, it's governed by a decentralized autonomous organization known as Doggy DAO. Doggy DAO is used to vote on proposals to the ShibaSwap ecosystem and determine the amount of WOOF rewards granted for certain SSLP staking pools. Individual voting power is proportional to the amount of tBONE held in one's wallet.
Shiba Inu metaverse
Shiba Inu metaverse
The Shiba Inu project also includes a metaverse component that integrates SHIB and other ecosystem tokens, including the Shiboshi NFT collection. The metaverse will consist of a virtual world with 100,595 digital land plots. Participants in the Shibaswap ecosystem will gain first access to the sale of metaverse land before it's open to the public.
The Shiboshis NFT
Shiboshi's are an NFT collection of 10,000 procedurally generated digital artworks depicting pixelated Shiba Inus adorning glasses, headwear, shirts, and other accessories along with various backgrounds. Upon the release of the Shiboshis on October 14, 2021, the entire 10,000-piece collection sold out in 35 minutes. The attributes of each Shiboshis NFT will correspond to the strength of the respective Shiboshi in the upcoming Shiboshis Game.
The Shibaverse is the latest development within the Shiba Inu ecosystem and it's similar to other metaverse projects like Decentraland. While the SHIB: The Metaverse project announced on March 30 that "we are in the final stages of signing a contract with a AAA Game Developer Studio" and that "we will be announcing the AAA Game Developer Studio this coming week," the actual studio that will develop the artistic direction of the metaverse is still to be announced. The Shiba Inu community is also developing a wiki to serve as an ecosystem guide.
A nation's culture resides in the hearts and in the soul of its people.
Cryptocurrencies that started as internet dog memes are now an accepted payment method at retailers like AMC, the largest cinema chain in the United States. We have officially entered the twilight zone. Is SHIB heading to become a medium of exchange?