Bitcoin vs. Dogecoin vs. Shiba Inu: Which Cryptocurrency Is A Buy?

Bitcoin, Dogecoin, and Shiba have their pros and cons. Which one is best for you?

Last Updated January 28th 2022

6 Min Read

Key points

Bitcoin, Dogecoin, and Shiba Inu have all experienced phenomenal growth
All cryptocurrencies carry risk, so it’s best to look at the pros and cons
The one you go for is subject to your level of risk tolerance

Despite their huge volatility, cryptocurrencies are on an upward trajectory. The total market capitalization is now at over $1.6 trillion, up from about $200 billion in 2020.

Bitcoin (BTC), Dogecoin (DOGE) and Shiba Inu (SHIB) are three of the most famous names in the crypto market, and they have recorded the most growth over the past year. In this period, Bitcoin price has rallied by over 387%, Dogecoin has soared by 8,317%, and Shiba Inu has increased by 3,000,000%.

Like other cryptocurrencies in the market, these three have their pros and cons. As such, it is important for an investor to do their due diligence before committing money on any of them.

Here are some of the things that an investor should know about these cryptos that can help in making the right choice.

Bitcoin

Pros: The biggest advantage to buying Bitcoin is its scarcity. For crypto that has unmatched global appeal, Bitcoin’s total supply is capped at 21 million. The circulating supply is now slightly over 18 million coins, but a couple of factors make it even scarcer.

One of them is that since launch, millions of Bitcoins have been lost forever. Then there is the fact that the number of new Bitcoins coming to the market is ever-shrinking.

This is due to the periodic halving of Bitcoin that cuts block rewards by half. For context, the reward per block after the 2013 Bitcoin halving dropped from 50 to 25. It will drop to 3.125 per block after the 2024 halving.

These supply shocks to the price of Bitcoin have made it a pretty good store of value. It is now considered digital gold, and in some respects, it is better than gold. That’s because it is easier to move Bitcoin than to transfer a bar of gold from one point to another.

When its low supply is correlated to its growing demand, especially among institutional investors, then there is a good chance that it will grow in value long term.

Another big advantage to Bitcoin is security. Many crypto projects have been compromised in the recent past, and many are at risk as hackers get more sophisticated.

Bitcoin is among a very small click of cryptos that probably can’t be successfully compromised today. For an attacker to bring down Bitcoin, they would have to raise 51% of the hash rate, which is almost impossible to do at this point.

Cons: Bitcoin is as volatile as any other cryptocurrency. While it always goes up despite the dips, these dips can be pretty huge at times. In the short term, it can hurt an investor, especially those who engage in leveraged trading.

The other drawback to Bitcoin is that its energy consumption is a huge concern for many. Energy consumption was one of the reasons that China cited when it banned mining. It’s an issue that could see it get into trouble with more regulators in the future.

Don't Miss: Ways to Make (or Lose) Money With Bitcoin (BTC)

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

Dogecoin

Pros: Dogecoin was one of the best crypto performers in 2020 and beat Bitcoin and many of the other big cryptos by a huge margin.

One of the advantages of Dogecoin is that it appeals to many celebrities, which in turn has increased its market visibility.

For instance, in 2020, Elon Musk pretty much took up the role of marketing Dogecoin on his social media. He was behind its more than 12,000% rally at its peak in April 2021.

The best thing about such celebrity endorsements is that they have opened up Dogecoin’s path to mass adoption. This year, more than 15 companies have started accepting Dogecoin for payments, including the Dallas Mavericks.

The other advantage of Dogecoin is that it is quite convenient for payments. Dogecoin payments are fast and more affordable than most cryptocurrencies. This means Dogecoin has what it takes to compete in the payments market.

Add to this the popularity it has gained from celebrity endorsements, and it’s not hard to see why Dogecoin’s potential as a payments crypto is strong.

Cons: The biggest drawback to Dogecoin is that it is inflationary. Every year, 5 billion Dogecoins enter the market.

For crypto that already has billions of tokens in circulation, its inflationary nature makes it a little weak long-term investment.

Then there is the fact that there are cryptos that are deflationary, and are more competitive than Dogecoin in the payments market. This may hamper its growth, especially after the celebrity attention that it currently enjoys dies down.

Check Out: Where Will Dogecoin Be In 5 Years?

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

Shiba Inu

Pros: Shiba Inu was created primarily to ride on the hype that Dogecoin generated in 2020. It positioned itself as the Dogecoin killer.

One of Shiba Inu’s biggest strengths is its strong community. The Shiba Inu community has ensured that Shiba Inu is visible on all social media sites, and search engines.

The strength of this community has seen Shiba Inu get adopted pretty fast, despite being a relatively new project. For instance, it was incorporated into Shopping.io’s basket of cryptos that can be used to make payments on major e-commerce sites like Amazon, e-Bay, and Walmart.

Another advantage to Shina Inu is that it has a lot going on besides the hype. In July 2021, it launched Shibswap, a DEX that allows for the exchange of SHIB for other tokens. It also allows for the staking of SHIB tokens. These are huge steps that paint a good picture for Shiba Inu long term.

Cons: One of the biggest disadvantages of Shiba is its huge supply. Once the hype that surrounds meme coins dies down, this could play against it. Such a scenario is evident in its current price action.

Shiba Inu has been lagging behind the broader market since the broader market recovery started in July. While this can always change, it is an indicator of the inherent risk of this crypto.

Read Also: Shiba Inu Price Predictions

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

Which Crypto Assets Should You Choose?

Essentially, when investing in these or any other cryptocurrencies, one should consider how much risk they are willing to tolerate. With proper research, you should be in a position to determine the level of speculative risk you are ready to take.

Cryptocurrency is a very high-risk investment, so before you invest in crypto assets, make sure you're willing to tolerate the high levels of risk and volatility.

While neither of these cryptocurrencies is a "safe" investment, Bitcoin may carry less risk than Dogecoin and Shiba because it has a longer track record and greater name recognition. However, Dogecoin and Shiba may have more opportunities for potential growth over time.