When Elon Musk speaks, bitcoin investors are listening, according to the Wall Street Journal.
Frequent enigmatic messages from the CEO of Tesla have driven the price of bitcoin to a frantic pace this year. The price jumped by almost 20% one morning in January when he added #bitcoin to his Twitter profile. It jumped 16% in one day, the month after it was revealed that Tesla had bought $1.5 billion worth of bitcoin.
Earlier this month, Musk tweeted that Tesla would no longer accept bitcoin as a means of payment for its vehicles. Investors are largely attributing the post to Twitter, the fastest-selling bitcoin this year, which lost hundreds of billions of dollars since its capitalisation and wiped-out gains since the end of January. After hitting near $65.000 in mid-April, the price of bitcoin has fallen about 50 percent, including a 40 percent drop from Elon Musk’s tweet in May.
The rapid volatility of bitcoin continued over the weekend. The digital currency was found to fall to $31.179, according to CoinDesk, from $35.263 on Friday afternoon.
Many investors decided to ignore Elon Musk’s posts as an unnecessary move in the course of the rise. Some investors, mostly young in the market, even celebrated the fact that Musk expressed his support for bitcoin.
Now that prices are falling, things are not the same for them. In fact, many are furious. “He knows he has a lot of influence and he has shown how much he likes to play with it – at the expense of those who follow him,” comments a bitcoin investor. She claims she “turned a blind eye” when she saw Musk’s latest posts cause panic amid fears that Tesla was preparing to get rid of its bitcoin holdings.
Tesla Musk has said he will not sell any bitcoin and will resume using the cryptocurrency for trading when concerns about high energy use are addressed.
“I feel bad for anyone making investment decisions based on the tweets of someone who is just trying to stay up to date and give an advantage to their platform,” she said, adding that she has no plans to reduce her placements.
Musk is not the only one influencing social media shopping. Throughout the past year, public figures, from investment managers to CEOs and celebrities, have used platforms such as Twitter, Reddit or the Clubhouse to express their thoughts on everything from cryptocurrencies to meme stocks.