ShibaSwap Explained: What Is ShibaSwap & How Does It Work?

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ShibaSwap - Crypto Diaries

Overview of ShibaSwap

ShibaSwap, launched in July 2021, is the dog-themed native decentralised exchange of the Shiba Inu project—the leading competitor to Dogecoin in the memecoin space which has gained quite some traction over the past two years. ShibaSwap is a constituent of the Shiba Token Ecosystem and boasts of a decentralised platform that allows users to track their portfolios, earn rewards, and gain access to NFT project launches. Participants in the ShibaSwap network can engage with features such as staking, NFTs, liquidity pools, voting on governance, and liquidity pools, some of which may earn them rewards.

Shiba Inu the Memecoin

Shiba Inu coin (SHIB) is an Ethereum-based ERC-20 token inspired by the Japanese dog breed ‘shiba inu’ which caused a viral meme trend in 2013 leading to the creation of the now infamous Dogecoin cryptocurrency. Shiba Inu was founded in August 2020 by the creator simply known as Ryoshi, and its mascot, the shiba inu dog, is the same as that of Dogecoin. According to SHIB’s whitepaper, or “woof paper” in this case, the Shiba Inu project is an “experiment in decentralised spontaneous community building”; essentially to find out what would happen if a cryptocurrency project was fully run by its community. 

Along with Dogecoin, Shiba Inu is a memecoin; coins built off internet memes, trends, or ideas that are appealing to a small group of investors. The rally of Dogecoin by nearly 7,000% virtually overnight, however, spurred investors to turn their attention to other under-priced assets hoping to be part of the fold when the next success hits. Shiba Inu, which was “designed to kill Dogecoin” was the investors’ next natural target.

Initially, the Shiba Inu project launched with 1 quadrillion SHIB. Ryoshi donated half the coins to Ethereum founder Vitalik Buterin who rather than keep them burnt nearly 40% of these coins in May 2021 and donated some tokens worth nearly $1 billion to charity. Meanwhile, Ryoshi locked the other half of the initial tokens in a liquidity pool. Currently there exist around 549 billion SHIB tokens in circulation with the total value hovering around the $26 billion mark. 

In addition to SHIB, the Shiba Inu ecosystem also consists of two other tokens: LEASH and BONE. LEASH is Shiba Inu’s second token with just 107, 646 coins in circulation while BONE is the project’s governance token that enables the community members to vote on upcoming proposals and boasts circulation of 250 million tokens. Shiba Inu coins are best purchased and sold on the projects native decentralised exchange ShibaSwap.

What is ShibaSwap?

ShibaSwap is a decentralised exchange (DEX), similar to Uniswap or Pancakeswap, allowing peer-to-peer trading of SHIB and other digital currencies in the absence of an intermediary. ShibaSwap also allows users to provide liquidity by depositing funds that other traders can trade against, in addition to staking tokens in a smart contract thereby earning interest using bone (BONE) and Doge Killer (LEASH) tokens.  The interplay of the three tokens SHIB, BONE, and LEASH serves to create a liquid, secure, and profitable ecosystem for users. 

BONE and LEASH Tokens

Bone (BONE)

BONE is the Shiba Inu ecosystem’s designated governance token with a maximum supply of 250 million coins. BONE allows users to propose as well as vote on potential changes to the ShibaSwap protocol through the Shiba Inu Doggy DAO. Basically, the more BONE tokens a member holds the more weight their vote carries in the ecosystem. BONE is also minted and used to reward users who provide liquidity on the platform.

Doge Killer (LEASH)

Initially, LEASH was set up as a rebase token of DOGE; that its supply would be automatically modified algorithmically to keep its price pegged to DOGE. However, LEASH is no longer pegged to DOGE and has instead been launched as an ERC-20 token with a fixed coin supply. As compared to BONE, LEASH is quite rare as it has a total supply of only 107,646 coins. The scarcity of LEASH is the reason the token is trading at $342 at press time, following the law of supply and demand. Due to its high price, LEASH has become the main store of value for investors in the Shiba Inu ecosystem.

How does ShibaSwap Work?

A glance at the ShibaSwap homepage reveals six functions available for users, each incorporating to various degrees the three native tokens of SHIB, BONE, and LEASH. These dog-themed functions of Dig, Bury, Woof, NFTs, Swap, and Bonefolio, along with others, are explored in further detail below:


Digging constitutes the liquidity pool function of the ShibaSwap protocol, enabling users to deposit digital currency in pairs to existing liquidity pools on the platform or create their own. Liquidity providers are rewarded with ShibaSwap liquidity pool (SSLP) tokens which are representative of their particular share of liquidity in the pool. SSLP tokens enable their holders to receive free BONE tokens when redeemed. 


The Bury function of ShibaSwap consists of users staking their BONE, SHIB, and LEASH tokens in order to generate high interest gains paid out in BONE tokens. Once users stake their preferred tokens, they receive a token that stands for their staked amount in either xSHIB, xLEASH, or tBONE. A third of the BONE rewards from staking are payable immediately while the remainder is locked up for 6 months. 


This feature allows users of ShibaSwap to exchange crypto tokens for other ones. Additionally, Swap allows user to exchange a single digital asset for multiple other assets depending on its value. 


Woofing is the ShibaSwap function for redeeming BONE rewards, made possible by users cashing out SSLP tokens on the platform.


Bonefolio is ShibaSwap’s analytics dashboard where users can track their investments as well as explore current interest rates and their return history. The dashboard shows historical staking and trading data as well as return on investment information. Additionally, a user can also access transaction fees, burn and mint amounts, all while staying on top of their yield rewards. 

Non-Fungible Token (NFT)

ShibaSwap has its own collection of NFTs known as ‘shiboshis’ intended to be part of the Shiboshi Game project. The Shiboshi NFT collection is comprised of approximately 10,000 units of the Shiba Inu mascot cartoons, not much unlike popular CryptoPunks. The Shiboshis are varied in their rarity, nature, as well as value, and their holders are able to customise their own Shiboshis thereby adding value to the NFTs in addition to enriching the game with certain unique properties. 

Burn Portal

Burning tokens essentially involves permanently eliminating said tokens from circulation by depositing them in a crypto wallet from which they can never be retrieved. ShibaSwap provides its users with a burning system that rewards those who burn SHIB by sending them RYOSHI tokens in exchange. 

Doggy DAO

Doggy decentralised autonomous organisation (DAO) is the ShibaSwap ecosystem’s governance system that is to be controlled by the Shiba Inu community (SHIBArmy). Doggy DAO is powered by the BONE token, according to the woofpaper, and the more BONE a user holds the more weight their ballot carries. To participate, users are required to stake their BONE to gain tBONE which shall then enable them to vote. 

Doggy DAO will also allow members vote on future ShibaSwap pairings using tBONE. However, the community does not have the final say in these matters and there a nine designated ‘Guardian Wallets’ which shall have the ultimate decision-making power on the new ShibaSwap listings; this is a mechanism seeking to thwart those who are intent on truly gaming the system. 


Getting Started with ShibaSwap

First, a new user will need to have set up a wallet in either one of the three ShibaSwap-compatible crypto wallet services which are Coinbase Wallet, Metamask, and WalletConnect. For the uninitiated user, two important points to remember when setting up their crypto wallet are the private key and the deposit. The private key is typically a long sequence of alphanumeric characters without which one would not be able to access their wallet and any tokens within. 

Once the wallet is up and running, the user needs to fund it with a sufficient amount of ETH to cover expected transaction fees, in addition to converting to one of the native SHIB, LEASH, or BONE tokens. Once the wallet is properly funded, the user needs to simply visit the ShibaSwap official website and click on the “Connect” button, and select the relevant wallet service. The user’s wallet will finally be linked to ShibaSwap allowing them to interact with its services. 

How Safe is ShibaSwap?

While it is certainly not a reliable metric by itself to gauge the security of a platform, 96% of blockchain security service CertiK’s users voted that they felt ShibaSwap was a secure service. CertiK has awarded ShibaSwap a safety score of 93/100, noting that the project has resolved 97% of the 34 issues raised during the platform’s gruelling audit process. ShibaSwap’s safety score is notable since it places the project ahead of other decentralised finance giants such as Polygon and Aave which both scored 92/100. Although these statistics are encouraging, it is still advisable for users to carry out their own meticulous due diligence on the associated risks before investing in any DeFi project.

Final Thoughts

For Shiba Inu users who are seeking a secure platform from which they can generate profits from investments in multiple ways, ShibaSwap is the project for them. The dog-theme running through the nomenclature of the platform also provides a game-like experience that makes the platform fun to navigate.

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