Elon Musk has shown again he can influence the digital currency market with just his tweets. After saying that his electric vehicle-making company Tesla will not accept payments in Bitcoin because of environmental concerns, he tweeted that he was working with developers of Dogecoin to improve system transaction efficiency. Following the two distinct statements from him, the world's largest cryptocurrency hit a two-month low, while Dogecoin rallied by about 20 percent. The SpaceX CEO has in recent months often tweeted in support of Dogecoin, but rarely for Bitcoin.
In a recent tweet, Musk put out a statement from Tesla that it was “concerned” about the rapidly increasing use of fossil fuels for Bitcoin (price in India) mining and transaction, and hence was suspending vehicle purchases using the cryptocurrency.
Tesla & Bitcoin pic.twitter.com/YSswJmVZhP— Elon Musk (@elonmusk) May 12, 2021
A day later he again tweeted saying, “To be clear, I strongly believe in crypto, but it can't drive a massive increase in fossil fuel use, especially coal”.
It triggered a downward spiral for Bitcoin value but the cryptocurrency has stabilised since.
To be clear, I strongly believe in crypto, but it can't drive a massive increase in fossil fuel use, especially coal— Elon Musk (@elonmusk) May 13, 2021
Working with Doge devs to improve system transaction efficiency. Potentially promising.— Elon Musk (@elonmusk) May 13, 2021
A number of Twitter users welcomed Musk's statement. One of them said it's time people started realising that Dogecoin “is here to stay” and another referred to Musk's previous assertion that crypto could become the world's future currency.
It is time that people stop saying DOGE is a joke and start saying it WAS a joke. It is real and it is here to stay!— Kelly & Kody (@positravelty) May 14, 2021
#DOGECOIN IS THE FUTURE CRYPTOCURRENCY OF EARTH!!!— Matt Wallace ⚠️ (@MattWallace888) May 13, 2021
It's happening ????????????????$DOGE the payment system.— David Gokhshtein (@davidgokhshtein) May 13, 2021
However, Twitter user @JeffTutorials also asked him to stop “manipulating” crypto markets and he was supported by a few others.
How about you stop manipulating the crypto markets?— Jeff ????✌️ (@JeffTutorials) May 13, 2021
This only shows how crypto cannot be trusted, if one person can influence a currency this much, what's its actual worth?— Michael DeLarge (@DelargeMichael) May 13, 2021
Time and again, Musk's tweets have influenced the value of Bitcoin as well as Dogecoin. While in February, a series of tweets by Musk, hailing Dogecoin, took the value of the meme-based cryptocurrency to wild levels. In March, the value of Bitcoin rose to a then all-time high of $60,000 (roughly Rs. 43 lakhs) after he announced that Tesla would accept the cryptocurrency as a mode of payment.