The Reason Why a Simple Tweet From Elon Musk Can Boost Dogecoin Price by +31% in a Few Hours
By: Sylvain Saurel
Tags: Cryptocurrency, Bitcoin, Cryptocurrency Investment, Dogecoin, Elon Musk

The Reason Why a Simple Tweet From Elon Musk Can Boost Dogecoin Price by +31% in a Few Hours

Illustration by Sylvain Saurel

I don’t generally write about Altcoins since I consider that only Bitcoin really matters. Nevertheless, an event that happened yesterday on Twitter, and which had a strong impact on the Dogecoin price, led me to make an exception to my golden rule.

Indeed, I received a lot of questions from people about Dogecoin following a tweet from Elon Musk.

A few people wanted to know what Dogecoin was, while the majority wanted to understand why a simple tweet from Elon Musk could increase its price by +31% in just a few hours.

So I will try to make you understand what has happened in the last 24 hours for Dogecoin.

It all starts on Sunday, December 20, 2020. Elon Musk is apparently in a playful mood, and he starts tweeting on Bitcoin and then on Dogecoin. After starting by saying “Bitcoin is my safe word”, Elon Musk laughs at the enthusiastic reactions of the Bitcoiners saying that nobody needs a safe word anyway.

Elon Musk continues his provocation by saying that “Bitcoin is almost as bs as fiat money”. Finally, Elon Musk ends his Sunday morning fun with the following tweet:

Just after this tweet, Elon Musk changed the biography of his Twitter account to include the following message: “Former CEO of Dogecoin”.

The enthusiasm of Tesla’s CEO for the Dogecoin project is a long-running meme. This is not the first time that Elon Musk has positioned himself in this way to support Dogecoin.

As a reminder, Dogecoin is a cryptocurrency that was launched as a joke on December 6, 2013. Its image is that of the dog Shiba Inu, which made it immediately very popular. A community of fans continues to use the DOGE regularly. If Dogecoin is nothing more than a joke, we can recognize two things:

Its longevity.

A healthy development that has allowed Dogecoin to continue to survive for so many years.

In July 2020, Elon Musk had already posted a tweet on Dogecoin talking about “Dogecoin Standard Future”. This had increased the price of DOGE by +14% in a few hours at the time.

With his tweet of December 20, 2020, Elon Musk was more successful since the DOGE price increased by +31% in a few hours:

DOGE price surged by +31% in some hours

If Elon Musk had some DOGE, he could almost be accused of manipulating the DOGE course to his advantage by creating pump & dump moves.

Elon Musk has nearly 41 million subscribers on Twitter. As a forerunner in the world of Tech, everything he says is extremely followed. A tweet from him on Twitter is bound to have great repercussions in the cryptocurrency world.

The repercussions are even greater for a cryptocurrency like Dogecoin which has a market cap of only 550 million dollars. A tweet from Elon Musk allowed Dogecoin to be trending on Twitter. This naturally draws attention to Dogecoin. As a result, many novices are starting to buy some DOGE.

The price of the DOGE was thus able to go from $0.00395 to $0.00524 within a few hours. At the time of writing the market cap for Dogecoin is now $654 million.

In July 2020, this pump initiated by a tweet from Elon Musk who talked about “Dogecoin Standard Future” was followed by a quick dump:

Dogecoin Pump & Dump on July 20

However, the situation might be different this time. Indeed, Bitcoin beat its ATH above $20K several times last week. Its price is still very close to $24K at the time of writing.

The fact that Bitcoin is hitting the $25K resistance suggests to some that an Altseason is about to start. Some people, therefore, see this increase in the Dogecoin price as a signal that the Altseason is about to arrive.

I don’t know if this empirical observation that some may have made will happen again in the coming weeks, but what is certain is that this pump in the Dogecoin price should alert you to something obvious: you should stay away from these Altcoins which are in fact only Sh*tcoins.

Contrary to what some will try to make you believe, none of these Sh*tcoins will replace Bitcoin. Bitcoin is the true monetary revolution that will change the world of the future for the better.

Buying these Altcoins will make you lose a lot of money in the end. Even if an Altseason should occur, don’t lose sight of the real signal which is the Bitcoin revolution.

Don’t pay attention to those provocative tweets from Elon Musk. He loves to have fun in this way on Twitter to see the reactions of his followers. Bitcoin is the unique invention that will revolutionize the world of the future when it comes to money.

It’s the only thing you must keep in mind.