Is Elon Musk just trolling the cryptocurrency community with his support of Dogecoin?
Elon Musk, the billionaire founder of Tesla and SpaceX, has touted the revolutionary impact of cryptocurrencies – while seemingly poking fun at the concept in the same breath.
In a video that was uploaded by Kevin Svenson, Musk can be heard saying, “there is a good chance that crypto is the future currency of Earth.” How ironic would it be if Dogecoin (DOGE), the coin invented as a joke, wins out in the end, Musk pondered.
Elon Musk talks about $DOGE Coin— Kevin Svenson (@KevinSvenson_) February 6, 2021
(Released 4 Hours Ago)@elonmusk said "There is a good chance that #Crypto is the future currency of Earth ... but which one is it going to be?" #Doge #DogeCoin #Bitcoin #cryptocurrency #cryptocurrencies #DOge pic.twitter.com/HDaf5jw3Xx
“What would be the most ironic outcome? That the currency that was invented as a joke in fact becomes a real currency,” he said.
DOGE has been at the center of a massive pump-and-dump spurred on by Reddit traders and investors who have become highly receptive to Musk’s tweets. The latter camp isn’t small, either.
A recent report from Blockchain Research Lab titled, How Elon Musk’s Twitter activity moves cryptocurrency markets, showed the billionaire has a positive influence on digital asset values and trading whenever he tweets about them.
The report said:
“Across all events, we identify significant increases in trading volume that are attributable to the events.”
Musk’s ability to move the markets through Twitter has left some investors worried given the enigmatic CEO’s turbulent history with the United States Securities and Exchange Commission, or SEC.
As CNBC reports, Musk’s tweets were behind the recent 12% surge in CD Projekt, which created the role-playing video game Cyberpunk 2077. Although Musk’s tweet had substance – namely, that Tesla’s Model S Plaid car would allow passengers to play the game – his apparent shilling of the GameStop short squeeze could have negative consequences for retail traders who get caught up in the hype.
After breaking above $500 in late January, GameStop's share price has plunged all the way back to the sub-$70 level.
Musk has run afoul of the SEC in the past after tweeting his desire to take Tesla private at $420 per share. He and Tesla each had to pay the securities regulator a $20 million fine to settle fraud charges related to the tweet. The settlements had serious ramifications for the electric vehicle maker's corporate structure:
"The settlements, which are subject to court approval, will result in comprehensive corporate governance and other reforms at Tesla—including Musk’s removal as Chairman of the Tesla board—and the payment by Musk and Tesla of financial penalties."
“I do not respect the SEC,” Musk said after he paid the fine.
Despite the regulatory backlash, Musk told 60 Minutes in a Dec 2018 interview that his tweets will not be censored. He explained:
“The only tweets that would have to be say reviewed would be if a tweet had a probability of causing a movement in the stock.”