The dog-themed cryptocurrency shiba inu (SHIB) hit an all-time high of $0.0000594 on Wednesday, marking a jump of over 111% in the past seven days. Though the price point may be tempting, experts say investors should make sure they know what they’re buying first.
“Before investing in any cryptocurrency, it’s important to understand what you’re investing in and the associated risks, not just hype around it,” said Douglas Boneparth, a financial planner and president of Bone Fide Wealth.
SHIB is primarily considered an altcoin, which refers to cryptocurrencies aside from bitcoin. Cryptocurrency can be very volatile and speculative in general, but experts say these qualities are exaggerated in altcoins.
“Altcoins like SHIB are primarily community-based, meaning their success is largely dependent on the success and growth of its community instead of its utility,” Boneparth said.
Brett Harrison, president of the cryptocurrency exchange FTX US, echoed the need for caution.
“Many altcoins can be extremely risky and may not have any inherent investment value, and retail investors should not trade these assets without research and due diligence,” Harrison said.