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The rise of fall of cryptocurrencies at the tweets of Elon Musk.
Cryptocurrency has surged across the globe, over the course of few years, witnessing either exponential gains or losses, due to high volatility.
And, as we must have studied in accounting and finance: the higher the risk, the higher the return (and subsequent losses too).
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However, cryptocurrency is one of the most interesting and trending topics, in recent times.
This is largely owed to the interest celebrities are taking in the crypto market, going as far as to secure reserves and accept payments in the form of the ever so popular Bitcoin, and its counterparts.
Despite the massive support extended towards cryptocurrency by celebrities, there are few who might be deemed as the enemies of the crypto market.
And when it comes to the number 1 crypto enemy (presumably), the name Elon Musk immediately springs to mind.
Elon Musk, in fact, is hailed as one of the most formidable enemies for the crypto market because of his back-and-forth behavior, against the same.
The Elon Musk Problem: Crypto Enemy or Friend?
Figuring out the crypto market has always been a hassle, surrounded by millions of speculations.
While the market remains highly volatile, to begin with, what’s more interesting and intriguing to note, is how a single man’s tweet may result in crypto market plunge or soar, given that cryptocurrency market was introduced as a decentralized ecosystem, without being affected by a single person’s say or speculations.
The single man’s tweet we’re referring to, is of Elon Musk, and how his recent statements, and even past ones, have influenced the crypto market.
The market, which was known to generate unprecedented returns to investors, is now being dominated by Elon Musk’s statements and speculations, making the whopping $1.5 trillion crypto market appear as child’s play and highly unsafe for investors.
For that reason alone, Musk may be considered as one of the biggest enemies of the crypto market, if not it’s 1st one enemy.
To put things into perspective, just by voicing his affection and interest towards Dogecoin (Shiba Inu themed cryptocurrency), ahead of his appearance on Saturday Night Live, back in May, the token soared, in terms of prices, and later, it plunged.
This goes on to show how Elon Musk’s comments or expressed interest in certain cryptocurrencies resulted in the market to rise or crash, making him a perceived enemy for the crypto market, in the eyes of those who are dedicatedly invested in the crypto market.
How it all started
One of the biggest advantages in this world is not being held accountable for your actions.
In simpler terms, being able to get away with absolutely everything. In this case, Elon Musk was able to get away with everything.
His stance on cryptocurrencies and the crypto market in general was more of a ploy for him.
He played a game of ‘Will-I or Won’t-I’ with the audience, causing a great deal of collateral damage in the crypto market for many investors, who were studying the patterns of the market tirelessly.
And here, a guy simply puts in a cryptic tweet about Bitcoin or Dogecoin, causes a massive shake-up in the crypto market.
Some people believe Elon Musk bought a lot of crypto, then tweeted good things about them, causing the price to rise a lot.
Then Elon Musk dumped all of his crypto, then slagged crypto, saying crypto mining and transactions use too much energy.
Elon Musk must have made untold billions of dollars of profits. Monies lost from young investors who were foolish enough to listen to and believe this big master manipulator.
If we go back to 2021 and talk about Bitcoin, the cryptocurrency that kicked off the crypto market in 2008, Elon Musk announced in February (of 2021) that Tesla would invest $1.5B in Bitcoin.
This caused the Bitcoin to grow exponentially in price, with one Bitcoin being worth $50,0000, at the time.
And this was the first time ever for Bitcoin to have surged to an unprecedented high.
However, fast forward in May, Elon Musk totally backed off, citing the adverse environmental costs of mining Bitcoin, coupled with significant amount of computing power, going back-end, he announced that Tesla would not be accepting payments in Bitcoin moving forward.
The price of Bitcoin immediately plunged.
Interestingly so, later, he, ‘presumably,’ pushed Bitcoin’s price up again, simply by tweeting about the ‘Mining’s Promise’ of deploying renewable usage.
This also stirred accusations of centralization on Elon Musk, for instigating a potential Bitcoin Mining Council, other than the existing one.
Fast forward to 2022, Elon Musk, perhaps, wielded even greater influence on Dogecoin, by putting up cryptic tweets on Twitter (the platform he is supposedly going to buy), highlighting his interest towards the cryptocurrency and, as we mentioned in the start, just ahead of his May 8th appearance, as host, on Saturday Night Live (SNL), the price of Dogecoin shot up.
He created a surge and sense of urgency amongst those invested in the crypto market, by commenting on Dogecoin and how he finds them to be ‘interesting,’ causing investors to invest a great deal in the coin, only to have suffered significant losses shortly after, amidst Elon Musk’s joke about Dogecoin being a hustle.
The fact that Elon Musk is considered as the ‘Dogefather,’ and the ‘Crypto Influencer,’ he is more of an enemy to investors in the crypto market, who are truly and significantly supporting the ecosystem of cryptocurrency.
The Crypto Pyramid Scheme: What does Elon Musk has to do with it?
Digital Assets have been the big talk of the town these days. Especially following the plunge of TerraUSD stablecoin, in May, causing investors to pull away from the crypto market.
Such events usually occur after unrealistic or perceived ‘guaranteed returns,’ are articulated to potential investors, creating a cycle of uncertainty and unprecedently high volatility, in an already high volatile market.
When such assumptions are made, the ‘Crypto Pyramid Scheme’ or ‘Digital Pyramid Scheme’ comes to light.
Elon Musk was sued by a Dogecoin Investor, for a whopping $258B, on 16th of June, Thursday.
He was tied to have been involved in a crypto pyramid scheme, amidst his acute interest towards Dogecoin and later washing off from his claims.
The complaint filed in the federal court of Manhattan by Keith Johnson, who is an American citizen, victimized by the sudden plunge and followed-up crash of the Dogecoin, claimed that Elon Musk was involved in articulating a crypto pyramid scheme, causing loss of billions.
The case pointed out to the fact that Elon Musk touted for Dogecoin, driving up its price in the process, only to let it tumble and drop down again.
“Defendants were aware since 2019 that Dogecoin had no value yet promoted Dogecoin to profit from its trading,” the case pointed out. “Musk used his pedestal as World’s Richest man to operate and manipulate the Dogecoin Pyramid Scheme for profit, exposure and amusement,” the plaintiff further added.
The fact of the matter is that there are many crypto pyramid schemes running in the market, but like we said above, one of the biggest advantages for anyone to possess, is to be able to get away with anything or everything.
And perhaps, this fits well with Elon Musk. Even if he was involved in this Dogecoin crypto pyramid scheme, there’s no way to tie him up and make him 100% accountable.
How did Elon Musk Affect the Crypto Market – Was it Market Manipulation?
While we talked about how the Tesla and SpaceX founder, Elon Musk, started off by putting up cryptic tweets and commenting his interests in cryptocurrencies, Musk, after the recent lawsuit, has driven away crypto investors even more. How so?
Prominent figures like Bill Gates and Warren Buffet have started to question the credibility of the crypto market and cryptocurrencies in general, making it even more difficult for individuals who were highly invested in the crypto market, to continue with their portfolio.
Musk’s unpredictable behavior has proven to be quite disruptive for the crypto market.
However, whether we should consider it as market manipulation, is still unclear.
Since Elon Musk never specifically told anyone to invest in a particular cryptocurrency, he could not be held accountable for the losses that came along for various crypto investors. However, it deemed Elon Musk as the worst enemy for the crypto market.
His stance and comments on cryptocurrencies influenced the soar, and later plunge, in the crypto market, causing many celebrities to back off from cryptocurrencies, in general. In addition, the crypto market, which started to pave its way into the future, started to look like a ploy to many renowned faces.
A market that could be presumably manipulated through comments of celebrities and giant Entrepreneurs, cited issues of credibility and most importantly, stability, in the long run.
What we need to understand
Shifting back to our topic with regards to why Elon Musk is one of the biggest or, perhaps even, the number 1 enemy for crypto investors or market, we need to understand why such assumptions are being placed.
When cryptocurrency popularly kicked off through Bitcoin, back in 2008, the crypto market, holistically paved the way towards freedom in investment.
While the market remained volatile from the very beginning, but it was based on the premise that, accommodated by a decentralized structure, the crypto market was meant to be impervious to any ‘single’ or ‘sole’ party influence, let alone being dominated and dictated by an individual guy’s tweet.
Having said that, after Elon Musk’s intervention, tweets, interests, or whatever you may like to call it, the crypto market seemed to have abolished the premise on which it was established.
The market started to look chaotic and wreaked havoc amongst genuine investors, who found the crypto market to be more of a ploy, than a decentralized digital currency ecosystem not being affected by a single person’s call or interest.
This takes us back to why Elon Musk is the number 1 enemy in the crypto market.
His tweets resulted in single person dictation of prices, making the entire ecosystem look like a sham.
Genuine crypto investors and founders of various crypto currencies did not fancy this at all, as it was going entirely against their vision of the future, and specifically, the future of digital currencies.
While digital currencies and the crypto market will continue to thrive in the future; however, the premise itself is destroyed.
Digital currencies will continue to be played by the likes of Elon Musk and other prominent faces and that is, in fact, a fact. A hurtful one, but one that we all must accept.
And Elon Must being the one who influenced this mechanism, points to show that, indeed, he is the worst enemy of the crypto market.
Elon Musk’s take on the Situation
The entire cryptocurrency market is tanking right now and almost all fingers are being pointed at Elon Musk.
Renowned crypto firms are becoming insolvent, and you must be wondering what Elon Musk has to say about the situation that has transpired in the crypto market.
Having said that, in a recent virtual appearance on Qatar’s Economic Forum, Elon Musk was questioned about the presiding crypto currency fiasco, where he said that he never advised anyone to invest in crypto currency.
He also said that the holdings SpaceX, Tesla, and himself have on Bitcoin is quite insignificant, in terms of % of total cash assets.
Musk sure had a bunch to say about cryptocurrency over the years, starting from his announcement to accept Bitcoin as a payment method for Tesla, then showing specific interest in Dogecoin.
However, technically speaking, Elon Musk did not specifically tell anyone to buy a certain currency, which is exactly what he elaborated upon, considering the current situation, in the Qatar Economic Forum.
Summing it up
While it is vividly clear that, regardless of what Elon Musk says or believe, he would always be deemed as the ultimate crypto influencer, for better or for worse.
However, people believe it to be worse, as Elon Musk caused a decentralized ecosystem to become an arbitrary one, being dominated by a single person’s decision or comments.
We have witnessed Elon Musk talk about crypto currency a great deal, with some cases being promotional too.
This alone was perceived as investment advice from the entrepreneurial giant. People believed Elon’s cryptic messages to be hints for investment decisions, which the guy himself does not stick to, playing a game of back and forth, causing significant losses to investors, in the process, indirectly, if not directly, making him the number 1 enemy for the crypto market.
Whilst Elon Musk probably made many billions of dollars manipulating the crypto market, you probably lost money and or are losing money. Elon Musk; the master of the crypto Ponzi controlled it, dominated it for a short time; long enough to make an absolute mint and thus become the richest man in the world.
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