Elon Musk’s History in Crypto 2021: How Does Tesla CEO Affect Bitcoin Prices?

For a long time, crypto investors lived in constant fear of Elon Musk’s tweets. And this is not surprising as every time he tweets about cryptocurrencies, the market seems to react to them. Moreover, one of his critical remarks or even a meme is enough for a rate to decrease by $5000-$6000. Here are the Tesla CEO’s most striking statements about Bitcoin!

Is Elon Musk Satoshi Nakamoto?

‘Elon Musk Probably Invented Bitcoin’ is the title of a Medium post written in 2017 by former SpaceX trainee Sahil Gupta. In his blog, he put forward the theory that the CEO of Tesla hides behind the pseudonym Satoshi Nakamoto, known for creating Bitcoin.

Gupta cited that Musk has enough knowledge and experience in development, finance, and cryptography as an argument. At one time, the founder of SpaceX worked at Zip2 and PayPal. Gupta further called Musk the modern Benjamin Franklin (mainly because the latter had founded the University of Pennsylvania, and the former had graduated from it).

The world media picked up the post of the former trainee, and as a result, Musk himself had to refute the information. He then replied on Twitter:

The First Crypto Boom

This was not Musk’s first statement about Bitcoin. Apparently, the earliest one can be considered his quote in an interview with Vanity Fair in October 2014. Then the CEO of Tesla said that Bitcoin would be useful for both legal and illegal transactions. Musk also highlighted that at that time, he had not had a single BTC.

For a long time, Elon Musk did not touch on the topic of Bitcoin in public speeches until he expressed his opinion about cryptocurrencies in an ARK Invest podcast in 2019. Musk spoke highly of the structure of Bitcoin and shared his confidence that digital currencies are the future. He said: 

Paper money is going away. Crypto is a far better way to transfer value than pieces of paper, that’s for sure.

The Second Crypto Boom

However, Musk’s statements and actions in late 2020 – early 2021 are of the greatest interest since they directly influenced the Bitcoin rate. On December 20, Tesla’s CEO tweeted: ‘Bitcoin is not my safe word,’ and ‘Bitcoin is almost as bad as fiat money.’ After that, the cost of BTC at the moment fell by 1.7%.

Still, Musk influenced the price of Bitcoin positively as well. In January 2021, he changed his profile description on Twitter, adding #bitcoin to it. This action was followed by a tweet: 

Immediately after that, the BTC price rose from $32,000 to $38,000.

The specialist Lennart Ante from the Blockchain Research Laboratory in Germany referred both of these cases to examples of how Musk influenced the value of Bitcoin. This phenomenon was called the ‘Musk Effect’ in the media.

Ante’s research also cites the latest tweets from the Tesla CEO mentioning Dogecoin, a cryptocurrency named after a Shiba Inu meme. On January 28, Musk posted a picture about Dogecoin, and four hours later, the value of the currency almost quadrupled. 

But the most noticeable effect had his December tweet: ‘One word: Doge.’ Immediately after the publication, the volume of cryptocurrency sales increased from 9 transactions per minute to 775.

Cryptocurrency Hater or Lover: Final Conclusions

Well, Musk himself admitted that he posted tweets about Dogecoin as a joke. He said: 

Arguably the most entertaining outcome, the most ironic outcome, would be that Dogecoin becomes the currency of Earth of the future.

At the same time, he seriously called himself a supporter of Bitcoin:

I am a supporter of Bitcoin. I think Bitcoin is on the verge of getting broad acceptance by conventional finance people.

Ironically, it was not Musk himself who influenced the Bitcoin price most noticeably, but his company Tesla — after the news that the company had invested $1.5 billion in BTC, the cost of the cryptocurrency jumped to $44,000. 

Another positive news from the Musk company also caused BTC price increases  after the announcement of the start of sales of Tesla cars for BTC, the value of BTC increased sharply by $2K.

What will be the next step of a businessman concerning cryptocurrencies? It is a mystery, but it will certainly be interesting!

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