In the cryptocurrency market of 2021, Shiba Inu (SHIB) was undoubtedly the most dazzling 'phenomenal player.'


This niche token, born in August 2020, experienced a crazy increase in just over a year — skyrocketing from nearly zero to a historical high of $0.00008616 in October 2021, with an increase of millions of times. At that time, there was even a joke circulating: 'If you invested the money for a cup of milk tea at the beginning of the year, by the end of the year you could exchange it for a house.'

What's even more amazing is that its performance crushed almost all top assets: Bitcoin's annual increase was less than 70%, Ethereum around 400%, gold barely maintained positive returns, while SHIB's increase made these numbers look dim.

The catalyst of the myth: an unexpected 'destruction feast'

The surge of SHIB was not without reason, and the key driver was actually a 'benevolent act' by Ethereum co-founder Vitalik Buterin.


When the project was launched, the founding team allocated 50% of the total supply (about 500 trillion tokens) into Buterin's wallet, initially to leverage the celebrity effect for endorsement. However, unexpectedly, this crypto mogul made a stunning move in May 2021: he destroyed 410 trillion SHIB (worth over 6 billion dollars at that time) and donated the remaining 90 trillion tokens to India's Covid-19 relief fund.

This operation directly halved the circulating supply of SHIB, instantly disrupting the supply-demand relationship. In the cryptocurrency market, the logic of 'destruction equals deflation' has taken root; once the news broke, investors flooded in, propelling SHIB into an epic surge.

From prosperity to decline: three years from revelry to calm

However, every myth has its day of reckoning.


Since its peak in 2021, the price of SHIB has fallen by more than 85%, now hovering around $0.000012. What exactly caused the once 'divine coin' to fall from grace?

1. No more 'saviors'
Buterin-style large-scale destruction has become a swan song. Currently, the circulating supply of SHIB still stands at 589 trillion tokens, with a total market value of about 7 billion dollars based on the current price. Such a massive base means that even destroying tens of billions of tokens would have a negligible impact on the price.

2. Speculation has receded, rationality has returned
The madness of 2021 largely stemmed from the market's emotional manipulation. At that time, social media was filled with stories of 'buy SHIB and get rich', with countless retail investors rushing in with the mindset of 'small investment for high returns'. However, as the cryptocurrency bear market arrived, speculative funds gradually withdrew, and SHIB, lacking actual value support, naturally took the brunt.

3. Practical scenarios remain thin
The team had hoped that the Shibarium network launched in 2023 could reverse the decline and provide SHIB with practical functions such as payments and DeFi. But the reality is that as of now, there are fewer than 50 applications based on this network, with very few daily active users, and there is still a long way to go before 'real-world applications' are achieved.

Is there still a chance for the future?

For those SHIB holders who are still holding on, opportunities may lie in two directions: one is whether the Shibarium network can unexpectedly explode, attracting a large number of developers and users; the other is whether the overall cryptocurrency market can warm up again, driving speculative funds back into the meme coin track.


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