Elon Musk’s Tweets Push Bitcoin’s Price: What Exactly is Going On?

A single tweet from Elon Musk can significantly increase or decrease the price of bitcoin, and he has demonstrated that he is capable of doing both. The genius, billionaire, and philanthropist who founded SpaceX and Tesla frequently discusses cryptocurrencies in his microblog, which frequently has a direct impact on the value of certain cryptocurrencies. This shouldn’t come as a surprise considering that Musk is widely regarded as one of the wealthiest individuals on the globe and that his company has approximately 56 million users.

Why Does Everyone Consider Elon to be the Cryptocurrency Guru?

Five years ago, Musk saw the full force of his Twitter account for the very first time. Investors and normal purchasers at the time were captivated with the news of the creation of Tesla’s new electric car model, the Model 3, which was to be the most affordable model in the company’s lineup. Model 3 was to be the most affordable model in the company’s lineup. The information that Samsung will become the battery provider for the Model 3 began to spread in the American media in June 2016, however the founder of Tesla decided to provide clarification on the matter.

“I would like to make it clear that Tesla is only collaborating with Panasonic on the development of batteries for the Model 3,” Musk said. According to a tweet that Elon Musk sent out at the time, “News reports that claim otherwise are wrong.”

Following the dissemination of this information, the price of Panasonic’s shares increased by 4%, while the total capitalization of the firm increased by almost $800 million. During the same time period, Samsung SDI, the battery, battery, and display subsidiary of Samsung Corporation in South Korea, had a decline of 8 percent, resulting in a reduction of $580 million in its market capitalization.

To be fair, the level of excitement that surrounded the Tesla Model 3 was so high that virtually any speculation regarding the specifics of its development caused movement in the financial markets. The news that Tesla was probably looking for another supplier caused the stock of the Taiwanese company Hota Industrial Manufacturing, which was the only supplier of gearboxes for Tesla electric cars, to drop significantly in April of 2016. This was due to the fact that Hota Industrial Manufacturing was Tesla’s only source for gearboxes.

Tesla & Doge

On April 1, 2018, Musk made the decision to play a practical joke on his followers by sending out a series of tweets claiming that Tesla was filing for bankruptcy. “Despite extraordinary fundraising efforts, including a desperate mass sale of Easter eggs, we regret to announce that Tesla is absolutely and irreparably bankrupt. We apologize for any inconvenience this may cause.” “We are so insolvent that it is impossible for you to even fathom,” the CEO of the company wrote.

The fact that this was a joke was fairly obvious; in his subsequent tweet, Musk stated that after this news, he himself was found lying unconscious near the Tesla Model 3, surrounded by bottles of Teslaqilla, and with traces of dried tears on his cheeks. Musk also said that he was surrounded by bottles of Teslaqilla. There is no way that it was an official statement, therefore what was the purpose of saying that? Best wishes for the beginning of the new month! The ranting of Musk came to an end.

In addition, through his tweets, Musk was able to boost the value of the cryptocurrency known as Dogecoin, which was named after the Doge meme. Early in the month of April, he made a promise to “deliver Dogecoin to the moon,” and later in the month of May, he indicated that SpaceX will launch a satellite to the moon in 2022 as part of a contract that would be totally paid for by this cryptocurrency. The value of dogecoin saw consistent and significant growth after each of these remarks.

It is not confined to merely social media platforms. At the beginning of February, it became public knowledge that Elon Musk’s Tesla had invested $1.5 billion in bitcoin. Musk also made the promise that Tesla will soon start accepting tokens as payment for electric vehicles. As a result of the news, the price of bitcoin reached all-time highs.

When one of the largest companies in the world starts holding bitcoin on its balance sheet as a substitute for cash, the market takes note, according to a piece written by Paul Hickey of Bespoke Investment Group. “Tesla is scarcely a traditional company,” Hickey said.

The investors did not find the joke to be funny in the least, and the timing for such conjecture was not successful because Tesla was experiencing a tumultuous period at the moment. A Tesla Model X was involved in an accident in the state of California around a month before the humorous tweets were sent out. Because of the collision with the bump stop, the driver of the car that was driving at the time of the accident passed away. At the time of the disaster, the factors that led to it had not been determined; however, there was widespread speculation on the network that the autopilot had been at fault.

A few weeks later, Tesla found itself in the middle of another controversy after the firm announced that it would be recalling 123,000 Model S electric cars owing to potential issues with the power steering. The business highlighted that there had been no accidents leading up to the recall, but the unfavorable history could not be altered.

What Can We Do with This?

Officially speaking, no one has the power to compel a businessperson to stop influencing the cryptocurrency market. The reaction of this market to the tweets of one individual is concerning; nevertheless, it is far from evident that Musk is willfully manipulating the course in order to profit from it, as Recode points out; however, it is troubling to see how the market reacted to those tweets.