Elon Musk’s Cryptocurrency Shenanigans

Intro

Elon Musk has proved to be an enigma for the cryptocurrency world. He has over 55 million followers, is the CEO of Tesla, Space X, and The Boring Company, and each and every tweet shakes the entirety of the crypto world. 

In January 2021, Elon Musk became the world’s richest man, with a net worth of $185bn, and quickly lost his place by March. This came after he lost some $6.2 billion of his fortune. His Space X Starship rocket tests failed 4 times, with a successful launching and landing later on. These erratic fluctuations in Elon Musk’s life seem to be characteristic of himself and his actions in the crypto world. 

The Dogefather 

Dogecoin used to be a cryptocurrency created to make fun of the cryptocurrency world; a satire of the wild speculations surrounding crypto. Dogecoin.com markets the currency as the “fun and friendly internet currency”; and yet, Musk has supported this coin that was initially created as a meme. His support has made the currency’s price soar significantly. 

The self-proclaimed Dogefather issued a tweet on January 29th of a mockup cover of Vogue featuring the Dogecoin dog in a red sweater. The magazine was titled “Dogue”, featuring articles such as “Ten tips on how to get the best treats”. Dogecoin increased by 682% in 2 days: $0.0078 to $0.0610. 

On February 4th, Musk tweeted “Dogecoin is the people’s crypto”. These 5, simple words saw a 44% increase in Dogecoin in 2 days: $0.0314 to $0.0451. 

February 7th saw another characteristic Elon Musk tweet, where he wrote “who let the Doge out”. This satirical take on an already-joked about song was spun into more memes by Dogecoin’s dedicated community. Musk’s influence led to a 57% surge in 2 days: $0.0491 to $0.0769. 

On April 14th, Elon Musk tweeted an image of Spanish artist Joan Miró’s 1926 painting: “Dog Barking at the Moon”. He titled it “Doge Barking at the Moon”. Given Musk’s endeavours to propel Dogecoin to the moon, it was a particularly apt tweet that sent prices above $0.10. The follow up on April 16th, “Everything to the moon!”, saw yet another surge in the Dogecoin price. Dogecoin saw a 330% increase in 2 days: $0.0766 to  $0.1306. On April 16th, the price went up to $0.3299. 

Dogecoin soared past the $0.50 mark for the first time on April 28th. This came after Musk fuelled the rumours surrounding him mentioning Dogecoin when hosting Saturday Night Live. It then peaked on May 5th. The possibility of a sketch about crypto pushed a 140% increase in Dogecoin in a week: $0.2747 to $0.6618. 

Following the mention of Dogecoin in an SNL skit featuring Musks’s mother, jokingly telling her son that she had better not get DOGE as part of her mother’s day gift, the price fell as low as $0.43. Also, on May 25th, he clarified that he is not directly involved in Dogecoin, when speculations arose about him treating Dogecoin like one of his own companies: actively marketing the coin, engaging with the community, and using his engineering and leadership prowess to contribute to the development of the cryptocurrency.

At the time of writing, Dogecoin is trading at $0.306253. 

Tesla Accepting BTC? 

Bitcoin’s (BTC) stellar run can also be partially attributed to Elon Musk. Like it or not, when Tesla’s chief executive speaks, investors listen. 

BTC prices soared by nearly 20% in January, when Musk added #bitcoin to his Twitter biography. In February, Tesla announced a $1.5 billion BTC purchase, and also announced that it would soon be accepting Bitcoin as payment for its products. This led to a $3,000 jump in just minutes, and the price surged by 20% in 24 hours. 

In March, Musk announced that Tesla cars could officially be bought using BTC. He said that the firm only uses internal and open-source software, and operate Bitcoin nodes directly. Also, he specified that Bitcoin paid to Tesla would be retained as BTC, and that it wouldn’t be converted to fiat currency. When the news broke, the dollar value of BTC jumped 2.9%, from $54,056 to $55,630. However, BTC’s peak was in mid-April, when it stood at a price of $64,829. 

However, on May 13th, Tesla announced that it would be suspending vehicle purchases using BTC. In a tweet, Elon Musk elaborated that there is concern surrounding the rapidly increasing use of fossil fuels for Bitcoin mining and transactions, particularly coal, which has the worst emissions of any fuel. He went on to say that crypto has a promising future as it is a great idea on many fronts, but that this cannot come at such a great cost for the environment. 

He added that Tesla will not be selling any Bitcoin and that the company intends to use it for transactions as soon as BTC mining shifts to using alternative and more sustainable sources of energy. The company is also looking into other cryptos that use less energy per transaction. 

This led to a crash: from $57,718, $47,620 in just 2 days. However, BTC has been decreasing ever since, with the price at the time of writing standing at $35,916. This cannot just be attributed to Elon Musk. China had a say in this, with its crackdown on cryptocurrencies in general. China mines more BTC than anywhere else in the world, and Inner Mongolia, an autonomous region in northern China, issued draft guidelines on a crypto mining ban. The area is a major hub for Bitcoin mining, which is why the news hit particularly hard and led to these dips in BTC. 

To conclude, Elon Musk has had a complex relationship with crypto, ranging from joking to serious. From his Dogecoin shenanigans to his dabbling in BTC on a business level, only to then back out, we’re sure that keeping an eye out on his tweets can lead to crucial information on the market. 

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Remi studied computer science which is always looking for an improved solution to society's demands, and cryptocurrency happens to be one of them. He joined the BiteMyCoin team in March 2018 and since has become engulfed in this new technology that can break the oligopoly of financial institutions.