Twitter CEO Elon Musk has been linked to several Dogecoin price spikes (quotation Doge) after his tweets sparked investor speculation. Recently, Musk posted another tweet that resulted in a moderate increase in the price of the meme coin over the past 24 hours.
In a statement believed to be an apparent joke, Musk tweeted: "Time to confess I let the Doge out." Attached to the post was an image that read, "It was me, I let the dogs out." There was also a later tweet where he wrote “Fact check me @CommunityNotes”.
The interesting aspect of this story is that the Shiba Inu has also undergone a surge, probably due to Musk's mention of "dogs" in the plural. Following the tweet, Dogecoin responded with a sharp 6,6% increase, while Shiba Inu was up 2,5%.
Prior to Musk's tweet, the Community Notes Twitter account posted that:
Starting today, you'll receive an alert if a Community Note starts appearing on a tweet you've replied to, liked, or retweeted. This helps provide people with additional context that they might otherwise miss.
Some users believe that Musk's tweet was a simple expression of a new feature introduced in Twitter. However, he tried to show his interest in meme currency.
Elon Musk's influence on the price of Dogecoin
Blockchain Research Lab's study of the effect of Elon Musk's moves on cryptocurrencies reveals that he wields an interesting influence on investors. According to the study, there was an average price change of about 3% for each of the 47 events following a Musk tweet. The study also observed that whenever there is an immediate and large price hike, another 45-minute hike follows.
Dogecoin's 24-hour movement ranged between $0,0832 and $0,0872. From the 24-hour price data, it can be understood that the price rally was not substantial as the asset failed to test its key $0,09 resistance level before registering its first retracement , as seen in the graph.
It was recently reported that Twitter will likely integrate Dogecoin payments into its platform. As part of the effort, Musk reportedly instructed developers to build the payment product so that cryptocurrency could be added in the future.
In 2021, Musk told Times Magazine that Bitcoin is fundamentally not good to exist as a substitute for transactional currency. Interestingly, he stated that Dogecoin is suitable for this purpose, even though it was created as a joke. According to him, Dogecoin encourages people to spend rather than hoard as a store of value. Also, he said that cryptocurrency has some advantages over fiat and clarified that he doesn't hate fiat.
Cryptocurrency has advantages over fiat, as fiat money tends to be diluted by any government. It ends up being a pernicious tax on people, especially those with cash savings, diluting the money supply.