GUEST POST - The crypto marketplace appears to have endured something of a contraction of late, having seen its total market cap value decline from just over $3 trillion to around $2.5 trillion.

This is largely thanks to the struggles of market leader Bitcoin, which has recently been unable to interrupt or shake a series of losses over a 10-day period.

As BTC saw its total value shelve around 20%, however, we ask whether so-called “altcoins” such as Shiba offer a viable alternative in the real-time marketplace.

What are Bitcoin and Shiba?
Let’s start with the basics; as Bitcoin is the trail-blazing and market leading crypto token and one that boasts a total market capitalisation value of more than $1.113 trillion.

Despite being a first-generation blockchain iteration, Bitcoin remains highly influential to this day, delivering both huge investor returns and inspiring a wealth of so-called “altcoins” to emerge during the course of the last decade (including Shiba).

In terms of the former, Bitcoin has seen its value increase more than three-fold over the course of the last 12 months, from $17,736.46 on November 28th, 2020 to its most recent price above the $59,000 mark. So, despite a relatively turbulent year that has seen the token lose more than 50% of its value during Q2, it remains a highly generative and lucrative asset from a long-term perspective.

Although Shiba Inu is one of several second and third-generation assets that have been inspired by Bitcoin, it has also been designed to cash in on the incredible success of so-called “meme coin” Dogecoin.

This token, which started out as a social media joke and has since evolved to achieve a joint valuation of $80 billion alongside Shibu, offers an entirely different purpose to Bitcoin, while its relative lack of utility casts a huge doubt over its ability to sustain such a value over time.

The Key Differences Between Bitcoin and Shiba

On the surface, this certainly suggests that Shiba is an unlikely candidate as a safe and reputable cryptocurrency investment, especially one that can be held for an extended period of time.

This represents a key point of difference with Bitcoin, which is known to hold long-term value and has seen its value appreciate steadily over the course of the last 18 months (despite interim periods of volatility).

This is arguably one of the reasons why established trading platforms such as the MetaTrader 4 don’t offer Shiba as a token for investment, instead favouring safer and more purposeful assets like Bitcoin, Ethereum and Litecoin.

In terms of underlying value, BTC is also aided by its status as a deflationary cryptocurrency. This means that it effectively becomes more scarce with time, due to a fixed supply cap of 21 million coins.

Conversely, Shiba has outlined an initial supply cap of one quadrillion, while the asset currently has a circulating supply of 500 trillion. So, as it isn’t a deflationary coin, it’s automatically less valuable than Bitcoin or Ethereum.

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