![]() ![]() Musk's comments have been known to move the price of Bitcoin as well, like when he tweeted that Tesla would no longer accept Bitcoin last May. Those beliefs can be be impacted a lot by a trivial element, like a seemingly off-the-cuff tweet from Musk blasted out in the early hours of the morning. "They are even more than any other asset reliant purely on the beliefs of the market,” she adds. But with cryptocurrency, there isn't an underlying value with price moves we can predict in the same way, Halaburda says. ![]() Traditional currencies, like the dollar, can have their values impacted by inflation or moves by central banks. In general, currencies derive their value from from the expectation that someone else will accept the currency in a transaction or buy it at the same or a higher price. The fact that Musk can tweet one thing and send Dogecoin's price up or down is evidence that the meme cryptocurrency is a more risky and volatile asset than cryptocurrencies like Bitcoin, says Hanna Halaburda, an associate professor at NYU Stern School of Business. "They are speculative games of musical chairs." They are not investments in projects that yield predictable cash flows, he adds. "The volatility of meme coins and their vulnerability to gratuitous tweets make them a dangerous place for investors," James Angel, a finance professor at Georgetown University, told Money via email. Hawaii Alaska Florida South Carolina Georgia Alabama North Carolina Tennessee RI Rhode Island CT Connecticut MA Massachusetts Maine NH New Hampshire VT Vermont New York NJ New Jersey DE Delaware MD Maryland West Virginia Ohio Michigan Arizona Nevada Utah Colorado New Mexico South Dakota Iowa Indiana Illinois Minnesota Wisconsin Missouri Louisiana Virginia DC Washington DC Idaho California North Dakota Washington Oregon Montana Wyoming Nebraska Kansas Oklahoma Pennsylvania Kentucky Mississippi Arkansas Texas Start Investing So it's not surprising that he has outsized influence in the crypto community as well.īut what does the way the market reacts to Musk's every word actually say about these crypto investments? Musk's company has become a cult stock, and when the billionaire makes moves like consulting his Twitter followers about whether or not he should sell 10% of his Tesla shares, it gets everyone talking on social media. And of course, there was that Saturday Night Live performance when the cryptocurrency's price plummeted after Musk called it a "hustle." His comment on Twitter in July that a Dogecoin update could give it an edge over popular cryptocurrencies Bitcoin and Ether, and Musk's post of a meme in April, also sent the meme coin's price surging. This wasn't the first time Musk's words have moved Dogecoin's price. At least, it is if you're Elon Musk.ĭogecoin's price jumped more than 10% at one point last Friday after the Tesla CEO tweeted that Tesla merchandise can now be bought with the meme coin. Twitter is powerful tool for moving cryptocurrency prices. ![]()
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