Musk Strikes Again! How Cryptocurrencies are still influenced by the ex-Twitter CEO

February 22, 2023

By Anjali Kochhar

Strap: Termed the “Musk effect”, Elon Musk recently tweeted a picture of DOGE being the new CEO of Twitter. And the effect yet again proved true with cryptos soaring high!

Elon Musk took the world by surprise when he announced his takeover of Twitter. From making the ‘blue tick’ easily accessible to mass lay-offs, the new CEO has made headlines every day. However, before the Twitter fiasco, Musk had a reputation for influencing cryptocurrency market movements through mere tweets.

Termed the “Musk effect”, the business magnate recently tweeted a picture of Floki, his dog, being the new CEO of Twitter. And the effect yet again proved true with soaring cryptos!

DOGE, Floki soaring high!

On February 15, 2023, Musk took to Twitter, posting a picture of Twitter’s new CEO – Floki, his dog. The tweet read, “The new CEO of Twitter is amazing”.

Immediately after, popular canine-based cryptos like DOGE, SHIBA INU, and Floki soared high on the crypto market. Before the tweet, Dogecoin was hovering at USD 0.082. However, the post skyrocketed its value by 5.4 percent, taking the coin’s value to USD 0.086.

Floki, another canine-based crypto coin named after Musk’s dog, also soared 41 per cent, due to Musk’s tweet. The impressive performance of these coins became a ray of hope for crypto investors, amid a tumultuous market atmosphere.

While some disregard the Musk Effect, terming it as ‘purely coincidental’, others are clearly feeling deja vu, after the recent tweet. Here’s a look at some past moments when Musk’s tweets markets soar!

The unrequited love for DOGE

Musk in the past has clearly expressed his fondness for Dogecoin. And this fondness translated into an obvious advantage for investors who took the meme coin seriously. Back in February 2021, Musk tweeted “Dogecoin is the people’s crypto”.

This tweet singlehandedly sent the meme coin soaring 10 per cent in just 1 hour! And to everyone’s surprise, DOGE reported a 50 per cent hike in 24 hours. This incident yet again stands as a testament that the Musk Effect is more than just a hoax.

DOGE Saga continues

In April 2021, Mark Cuban, a notable American billionaire, and entrepreneur in a conversation with CNBC stated that Dogecoin is the best cryptocurrency, as a means of money exchange.

Musk was quick to reply, “I’ve been saying this for a while.”

This tweet again led to a surge in DOGE’s price, hiking its price by 20 per cent, within 24 hours.

Musk entangled with Bitcoin

Well, it’s not always positive news. The crypto market has also faced multiple falters owing to Musk’s spells on the microblogging platform. Case in point – the incident that took place on May 13, 2022.

The ex-CEO of Twitter announced that tesla had temporarily stopped taking vehicle payments through Bitcoin, the leading cryptocurrency. The supposed reason behind this decision was the “increasing use of fossil fuels to drive Bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel.”

Here’s the exact tweet.

While some faltered at Musk’s environmental concerns, crypto investors took this criticism seriously. Immediately thereafter, Bitcoin fell from $54,819 to $45,700. This was its lowest value since March 01, 2021.

In a nutshell

2022 has not witnessed too many crypto debacles owing to the Musk effect. The obvious reason can be attributed to the billionaire being preoccupied with running Twitter, or the lack thereof. But with a new CEO leading the social media platform, Musk might just get time to stir up cryptocurrencies in the future.

About the author

Anjali Kochhar covers cryptocurrency stories in India as well as globally. Having been in the field of media and journalism for over three years now, she has developed a sharp news sense and works hard to present information that goes beyond the obvious. She is an avid reader and loves writing on a wide range of subjects.

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