Elon Musk’s tweets move the crypto market whenever he posts them. Tweeting, changing his profile picture or adding “#Bitcoin” to his bio affect the markets – the latter more so, sending Bitcoin (BTC) price up by 20%. Because of this, many are anticipating what Musk’s Twitter investment for crypto can bring.
Recent filings show that Tesla CEO Elon Musk purchased a 9.2% stake on Twitter making him the largest stakeholder in the platform. In early trading, Twitter shares jumped by more than 22 percent and Dogecoin (DOGE) reached two-month highs.
According to Ken Li, Binance Labs’ investment director, Musk’s investment could support Binance’s crypto initiatives and even allow DOGE to be integrated on the platform.
According to Li, “Elon Musk‘s investment in Twitter could help to increase the acceleration of Twitter‘s crypto adoption. It remains to be seen whether Twitter will begin adopting Elon‘s beloved Dogecoin moving forward.” He also explained that:
“Elon has always been very public about the concept of a more decentralized and censorship-resistant social media platform, and this is something that blockchain and Web3 technology can help enable.”
Aside from Musk tweeting a funny poll, no official announcement was made regarding the billionaire’s plans for Tesla.
However, considering Tesla CEO Elon Musk and Twitter’s history with crypto, one possible interpretation would be that the event will bolster Twitter’s exploration of more cryptocurrency and blockchain features.
In February 2021, a filing revealed Tesla purchased 1.5 billion bitcoins. The celebrity entrepreneur started a frenzy in March 2021 by announcing Tesla’s plans to accept bitcoin as payment for Tesla vehicles. Several months later, the market fell after Musk announced that the firm dropped the plan due to the alleged environmental impact of Bitcoin mining.
Apart from Bitcoin, Elon Musk has been associated with DOGE. Due to Musk’s love of memes, his DOGE tweets have been linked to the asset’s price soaring, leading to Musk being accused of price manipulation. Later in 2021, he declared that DOGE was better than BTC for payments. Tesla began accepting DOGE as payment in January 2022.
Even so, Musk’s electric car manufacturer held $2 billion in Bitcoin as of late 2021, according to official records. In March 2021, Tesla sold a portion of its BTC holdings to assess the liquidity of the volume. The sale generated at least $128 million in realized gains.
On Twitter, on the other hand, has also been experimenting with blockchain-based technologies such as nonfungible tokens (NFTs). In January 2022, Twitter began supporting NFT avatars for Twitter Blue subscribers, a $2.99-per-month subscription service. Musk, however, responded negatively to the feature.
Besides this, Twitter also lets users tip with crypto through its tip jar feature. As of September 2021, BTC tipping was enabled on the platform, allowing users to use third-party apps for receiving tips. The platform added Ether (ETH) to its tipping payment options in February 2022.
Musk’s tweet may have led the community to speculate that he would first attempt to fix the issue of crypto scammers spamming Twitter. Crypto advocate Michael Saylor suggested this solution:
“Crypto Twitter” is a term for a reason. As the go-to debate hub for the web, the once known “microblogging” platform has become a hub of fast-paced interaction and rich interaction options for the crypto community.
Musk’s purchase means that at least two crypto celebrities, including former Twitter CEO Jack Dorsey, are now among Twitter’s shareholders. The list can grow indefinitely.