Shiba Inu (SHIB): A Contrarian Buy Amid ETF Frenzy and Supply Destruction

The crypto market is no stranger to extremes. In 2025, Shiba Inu (SHIB) has become a case study in contrarian value investing, trading at a discount to its intrinsic deflationary potential while institutional forces begin to take notice. Despite a 6% price drop in late October and early November, according to Benzinga, SHIB's token burn rate has surged to unprecedented levels, with over 1 million tokens destroyed in a single day and a 139.46% weekly increase in supply destruction, per Coinotag. This creates a compelling narrative for investors willing to look beyond short-term volatility and focus on long-term scarcity dynamics.

Deflationary Mechanics: A Tailwind for Scarcity

SHIB's burn rate has become a key driver of its market fundamentals. In early November, the network burned 61 million tokens in a week, reducing its already massive circulating supply, Coinotag reported. To put this into perspective, the cumulative burn rate in October and November 2025 has erased over 115 million SHIB tokens from circulation-a move that directly counters the project's historical criticism of inflationary supply. Analysts argue that this deflationary tailwind could create a "rebound loop": as burns accelerate, scarcity increases, potentially triggering a self-fulfilling price recovery, according to CoinMarketCap.

What makes this even more intriguing is the timing. SHIB has historically posted double-digit gains in November, with 6.55% and 49.33% returns in 2023 and 2024, respectively, Coinotag notes. If the current burn rate persists, the combination of technical momentum and seasonal strength could unlock a 25–35% upside from current levels, particularly if the price breaks above key resistance zones, CoinMarketCap suggests.

Institutional Recognition: From Meme to Mainstream

The contrarian case for SHIB is further strengthened by institutional developments. T. Rowe Price's filing for the first U.S. spot Shiba Inu ETF marks a watershed moment, according to Yahoo Finance. This move not only legitimizes SHIB as an investable asset but also opens the door for a new wave of capital from ETF-driven investors. Grayscale's inclusion of SHIB in its FTSE Grayscale Crypto Sectors framework-specifically the Consumer & Culture sector-adds another layer of credibility, Benzinga reported.

However, the institutional landscape remains uneven. While SHIB's ETF filing is groundbreaking, Ethereum-based ETFs have dominated Q3 2025 inflows, pulling in $2.4 billion compared to Bitcoin's $827 million, as Rareevo reported. This reflects a broader institutional preference for Ethereum's utility-driven model over Bitcoin's store-of-value narrative. For SHIB, this creates a unique opportunity: it's a high-conviction, low-competition play in a market still grappling with meme coin skepticism.

Contrarian Value Investing: The SHIB Thesis

Contrarian value investing thrives on mispricings. SHIB's current valuation-despite its deflationary mechanics and institutional tailwinds-appears to discount its long-term potential. The token's circulating supply has shrunk by over 0.0001% in the past month (a significant figure given SHIB's 1 quadrillion+ supply), yet its price remains below $0.000008, Coinotag observed. This disconnect between supply destruction and price action suggests a market that's not fully internalizing the project's fundamentals.

Moreover, SHIB's ETF filing introduces a new variable: institutional liquidity. Unlike Bitcoin or Ethereum, which already have established ETFs, SHIB's ETF is in its infancy. This means early adopters could benefit from both retail-driven speculation and institutional-driven demand as the product matures. For investors with a 12–18 month horizon, this represents a high-conviction, asymmetric risk-reward scenario.

The Road Ahead: Risks and Rewards

Critics will point to SHIB's lack of utility compared to Ethereum's staking and smart contract capabilities. They'll also highlight the ETF's regulatory hurdles and the broader meme coin market's volatility. These are valid concerns-but they also underscore the contrarian angle. SHIB isn't a "safe" investment; it's a speculative bet on a project that's evolving from a joke to a serious contender in the deflationary meme coin space.

For investors willing to tolerate short-term noise, the rewards could be substantial. If SHIB's burn rate continues to outpace its price decline, and if the ETF gains regulatory approval, the token could see a multi-bagger move in 2026. This is especially true if Ethereum's ETF dominance wanes and investors seek alternative deflationary plays.

Conclusion

Shiba Inu is a textbook contrarian opportunity. Its price has lagged behind its fundamentals, but its deflationary mechanics and institutional tailwinds are creating a foundation for long-term value. For investors who can stomach the volatility and recognize the asymmetry in the risk-reward profile, SHIB offers a compelling case in a market still underestimating the power of meme coins. As the ETF frenzy continues, SHIB's story is one of resilience-and potentially, a breakout.