Do Elon Musk’s Words Matter for Crypto in the Long Run?


By Liam Bussell, Head of Communications of Banxa

“Spoke with North American Bitcoin miners. They committed to publish current & planned renewable usage & to ask miners WW to do so. Potentially promising,” Elon Musk tweeted at the end of May. So what will happen to Bitcoin prices now? Over the last few months, Musk has influenced cryptocurrency positions and values worldwide, namely Bitcoin and Dogecoin. When Musk was singing the praises of blockchain, the token soared to new heights. Then, seemingly overnight, Bitcoin’s value dropped 40 percent.

The newbs are running scared, but long time HODLers know this is just the ebb and flow of crypto prices. We constantly see tweets and headlines saying: “It’s down 24% since last month.” “Bitcoin is down 12% this week.” “Bitcoin had its largest ever fall today.”

How To Get Free Crypto  

BTC is still up 350% since January, a solid gain for a bull run. It’s almost as if crypto doesn’t act like shares—so when the business media look at crypto, they don’t have a proper metric to evaluate. 

As crypto prices began to soar earlier this year, the mainstream investor began seeing digital assets as a viable, smart investment. At the beginning of May 2020, a single bitcoin was worth $9,000. Nearly a year later, the price had skyrocketed to more than $60,000, and now it’s somewhere in between.

Elon Musk took a particular liking to Bitcoin, the world’s largest cryptocurrency by market cap. He tweeted about it, got Tesla to put it on its books and even put out an announcement saying Tesla would accept Bitcoin as a form of payment. Then, as quickly as he jumped on the bandwagon, he jumped off. Musk tweeted, “Tesla has suspended vehicle purchases using bitcoin… Tesla will not be selling any bitcoin and we intend to use it for transactions as soon as mining transitions to more sustainable energy.” 

Influencers aren’t jumping overboard just yet 

Mark Cuban also jumped on the crypto bandwagon earlier this year with his support for NFTs, Ethereum, and DeFi. He has been all over the media, social and mainstream, showing his support for cryptocurrency. The billionaire’s Twitter account seems devoted to his interest in NFTs, Ether and Dogecoin. 

Coinbase Banner  

It’s not only a billionaire entrepreneur’s game though. Former pornstar and TikTok sensation Mia Khalifa has also shared her crypto investments with her millions of followers. She tweeted, “Okay I caved and bought the dog stocks,” in reference to Dogecoin. 

While some are singing their praises, others are not convinced that this newfound influencer love of crypto will have long-term effects. Still, influencers aren’t the only ones affecting the market—governments do too. For example, China recently doubled down on their crypto stance and banned banks and payment firms from providing services related to cryptocurrency transactions. This ban was implemented in May, right before the Bitcoin price crash. Some say this prohibition on crypto may have had the same effect as Musk’s tweets. Crypto has been illegal in China since 2019 to curb money-laundering threats, but many are still getting around the ban by trading online.

It’s worth thinking about whether these influence peddlers just see the sheer volume of column inches media dedicated to crypto during a bull run as a vast, untapped resource, and want their piece of the pie. It’s hard to know whether some of them hold the coins they claim they do. 

Price volatility is not an earth-shattering concept

Volatility is not a new concept in the cryptosphere. Looking at the value of bitcoin over the last 10 years, its frequent swings between up and down are apparent. We saw another huge price dip when bitcoin jumped to $19,000 in December 2017 and then dropped to nearly $3,000 in December 2018. While the price can drop a lot in the short term, it has been on a constant upward trajectory since its inception.

FreeBitcoin Banner  

Broadly speaking, the trend for digital assets works on 2-2.5 years cycles, in 2011, 2014, 2017/18 and 2021. Between these periods, regulation becomes clearer, and the ability to access digital currencies becomes easier for the mass market

And even if another Crypto Winter does loom over us all, it won’t be like the last one.

A far cry from the crypto market of ICO scams in 2017, cryptocurrencies, digital assets, and the broader blockchain industry has matured and embedded itself into various niches, from finance to digital identification to gaming.. Transparency and distributed ledger technology, along with growth in venture capital investments, is driving the growth of the industry. The global blockchain market size sat around $3 billion in 2020 and is expected to grow to $39.7 billion by 2025, which is a Compound Annual Growth Rate (CAGR) of 67.3 percent during those five years, according to a Blockchain Market Report. 

DeFi, a massive subset of the broader crypto industry, stands as a $100-billion sector. Nearly 1 million people invest in some form of this crypto niche that represents a large array of lending, trading, and betting activities done almost entirely on different blockchain networks using tokens, according to CoinGecko. 

Crypto Winter or not, crypto will continue to grow in the long run. Banking and financial services will hold the largest market size, as more traditional financial institutions join the movement and continue to help secure payments and transfers for clients. Venmo, the mobile payment service owned by PayPal, even recently added crypto to its ledger. Now, if one has a Venmo account they can also buy, trade, and invest in cryptocurrencies—Bitcoin, Ethereum, Litecoin, and Bitcoin Cash—on the app.

At this point, crypto is simply too big to stop. Major corporations, such as Amazon and Microsoft, have already begun integrating blockchain and crypto into their business models. Microsoft recently announced the launch of the Azure Confidential Ledger service, powered by blockchain, while Amazon also recently developed its own blockchain technology. The companies are adopting crypto as a form of payment and are even looking to build blockchain platforms of their own. Mass market adoption of cryptocurrency is inevitable, even if people aren’t ready yet.

No one really knows Musk’s reasoning for publicly shilling bitcoin, doge, and crypto in general, but it’s a little surprising he just discovered the energy problem now—especially so shortly after accepting bitcoin as payment for Teslas. Is it vanity, a genuine misunderstanding of how crypto works, or maybe even backlash from Tesla buyers and shareholders? Relying on the voices of influencers works in the short term, but 10 years from now people won’t remember which celebrity said what. They will, however, certainly remember which crypto companies keep their eye on the prize and get with the times. 

About the Author

Liam Bussell was formerly Chief Marketing Officer @ Diginex (NASDAQ:EQOS), Former CMO at BC Group (SEHK:863), Former Head of Marketing, World First (Acquired By Alibaba) and is now Head of Corporate Communications and Investor Relations at BANXA.

A marketing leader with 18 years’ experience building Fintech & Technology companies from bootstrapping through to listed companies.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Go to Source
Author: Guest Contributors

Recommended Crypto Services, Products and Strategies:

The first thing any crypto investor needs is is a reliable and secure Crypto Wallet.  Whether you’re looking for an online wallet, hardware wallet, desktop or mobile wallet, Crypto Renegade provides you with all the Best Crypto Wallets in each category.

Best Crypto Wallets Banner

When you’re ready to buy more crypto, or exchange your coins for others, Crypto Renegade’s list of the Best Crypto Exchanges has you covered.  The Crypto Exchanges recommended here offer everything from simplicity and convenience to advanced trading platforms and profit sharing. 

Best Crypto Exchanges Banner

If you want to learn more about the methods and tools that can be used to find Great Crypto Projects, then be sure to check out Crypto Renegade’s strategy for How To Find The Best Cryptocurrency.

Crypto Strategy Banner

For those people that don’t have any money to invest right now, or just want to understand the technology a bit more, you’ll definitely want to check out Crypto Renegade’s Free Crypto Strategy and start collecting Free Coins today!

Free Crypto Banner

What do you think about cryptocurrency? Do you have any questions about it? Be sure to leave a comment below.

This site uses Akismet to reduce spam. Learn how your comment data is processed.