2024 was a great year for cryptocurrencies, with the total value of all coins and tokens soaring to an all-time high of $3.9 trillion

The year 2024 was a banner year for cryptocurrencies, with the total value of all coins and tokens surging to a staggering all-time high of $3.9 trillion shortly after President Trump was elected in November. Investors were enthusiastic about his pro-crypto stance and the promising prospect of favorable government policies. Even cryptocurrencies at the highly speculative end of the market experienced significant surges.

At the beginning of the year, meme-token Shiba Inu (SHIB 3.09%) was trading at $0.0000018, but by the end of the year, the token had gained 107%, reaching a price of $0.000013. This performance delivered one of the greatest returns in the history of the financial markets that year, especially when compared to the S&P 500's yearly gain of 11.5%.

If you had a crystal ball and timed your investment perfectly, you could have seen an incredible return of 45,278,000% from Shiba Inu in 2024. With just a $3 investment at the start of the year, you could have become a millionaire by the year's end.

Some of the math behind the answer might blow your mind.

Image source: Getty Images.

Pro-crypto government policies probably won't help Shiba Inu

President Trump campaigned last year on a promise to make America the crypto capital of the world. In his first 100 days in office, he has already appointed an SEC chairman with experience in the crypto industry and created a digital asset stockpile for the government to hold crypto.

With a pro-crypto administration in place and a new chairman at the SEC, the stage is set for some interesting developments in the coming year. Could we see Shiba Inu hit $1 by 2025?

At the beginning of 2024, Shiba Inu was trading at around $0.0000018, and by the end of the year, it had reached $0.000013, which is an impressive gain of over 100%. However, to reach $1, Shiba Inu would need to rise by an astronomical factor of 76,923 from its current price.

To put this into perspective, if the S&P 500 were to increase by a factor of 76,923 from its current level of 4,600, it would reach an astounding height of 354,180,000.

The headwinds I mentioned above will certainly be hurdles on Shiba Inu's journey to $1, but its supply could be an even greater barrier. There are 589.25 trillion tokens in circulation, so at the current price of $0.0013, Shiba Inu has a market capitalization of $7.5 billion.

Simple math suggests that a price of $1 per token would result in an eye-popping market cap of $589.25 trillion. In other words, Shiba Inu would be 12 times more valuable than the combined market cap of all 500 companies in the S&P 500, which stands at $47.5 trillion as of this writing. It would also make Shiba Inu almost 20 times more valuable than the annual output of the entire U.S. economy, based on a gross domestic product (GDP) of $29.7 trillion last year.

To summarize, there is no way Shiba Inu could reach $1 in its current state.

The mind-blowing way Shiba Inu could still reach $1

The Shiba Inu community has banded together to solve the supply problem by “burning” tokens, which means removing them from circulation forever. The simplest way to do this is by sending them to a dead wallet where they can never be retrieved.

In theory, the price per Shiba Inu token will rise in proportion to the number of tokens burned, so this could be a legitimate pathway to reaching $1. However, investors will have to burn 99.99998% of all current supply to succeed, leaving just 7.5 billion remaining in circulation.

Unfortunately, burning 589.24 trillion tokens is a monumental task; investors burned just 346.7 million last month, which translates to an annualized rate of 4.1 billion.

At the current pace, it will take a mind-blowing 143,717 years to burn enough tokens to reach $1. But it gets worse because even if you lived to see that day, you wouldn't