Ever since the rise of the cryptocurrency market back in March 2020, many famous investors and entrepreneurs adopted this new technology. People often wait for endorsements in order to jump into anything. This definitely makes them laggers, giving early adopters the clear advantage. For cryptocurrencies, early adopters who bought before the mainstream are definite winners. Elon Musk is one of those crypto influencers, able to move markets in either sides. He already pumped up prices through his Tweets and did the exact same to crash everything with no real logic behind his decisions. What’s the “Elon Musk Crypto” dilemma about, and are Elon’s Tweets still influential in the crypto space?
Elon Musk Pumping the Crypto Market
Back when Elon Musk started his crypto journey, the crypto market was already on an uptrend. This comes as prices became very cheap after the COVID-19 events that crashed markets across the world. From the equity market all the way to cryptocurrencies, everything started to pick up after sever panic selling.
Elon Musk noticed Bitcoin when prices started to rise, and more specifically midway through the Bullrun of 2020. He first started off with a few tweets, then later put the Bitcoin logo on his Twitter Bio. This happened toward the end of January 2021.
What Happened After the Very First Bitcoin Endorsement?
Following this sudden endorsement, people starting buying in an uncontrollable way. They even forgot about all technical and fundamental aspects that come with investing. Newbies started to base their investing on Elon’s Tweets. This is definitely something scary and alarming, as any sudden market adjustment would cause prices to collapse instantly – 2018 style.
The entire cryptocurrency market picked up after Elon’s endorsement. The mainstream media highlighted those events and were responsible for spreading false informations at times. Instead of talking about the technology behind cryptocurrencies and blockchains, they started to highlight high cryptos were making double-digit performances in such a short time.
Elon Musk ENDS his Crypto support
In a sudden tweet, Elon decided to abandon his Bitcoin stance. He basically claimed that Bitcoin was not eco-friendly. This news alone caused the crypto market to collapse and lose more than 80% of its value within weeks time. It’s kinda funny to know that Elon changed his stance, although nothing fundamental changed in Bitcoin.
That’s why two things come to mind when thinking about this topic:
- Either Elon bought the Dip and cashed out
- Or the guy is just having fun and loves media attention
In honestly, it might be a bit of both. When the famous SNL show was aired, people could clearly see how Elon appeared as a nerd seeking attention, wanting to look “cool and nerdy”. On the other hand, the show was a complete failure, as the crypto market (and specifically Dogecoin, Elon’s favorite” crashed heavily. Day traders were anticipating this big day, and liquidated everything as soon as The show started.
Again, looking at both figures 1 & 2, one can’t but assume that this whole plot was carefully played to buy low and sell high. Tesla company had to disclose its Bitcoin holdings as it is a public company. For Elon Musk, he can simply buy and sell anonymously, or through other people without disclosing any of his activities.
Conclusion
When investing or trading, one should never listen to anyone, even if they were famous people or entrepreneurs. Anyone can be at fault, and no one will comfort you once you lose. That’s why it is always important to do your own research, learn how to chart and analyze the markets and make educated decisions. Basing your trades solely on someone’s funny tweets won’t bring you anywhere. The crypto market should in the future stop being manipulated by tweets and become well-established. That’s why crypto investors entered the arena from the first place: because of Decentralization. We don’t want to be centralized around Elon Musk forever!
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Rudy Fares