A rising variety of enterprise leaders and celebrities — e.g., Elon Musk, Jack Dorsey, Alex Ohanian and, most lately, Ricardo Salinas — have added the Bitcoin hashtag to their Twitter biographies. It hasn’t gone unnoticed. When Elon Musk added #Bitcoin to his bio in late January, Bitcoin soared by 20%.
If certainly a succession of billionaires and tech moguls have taken the Bitcoin pledge — no matter that may entail — what’s their motivation? Are they attempting to control the market, as an illustration — or promote their model?
Could they be simply seeking to pull the collective leg of crypto’s true believers? The CEOs, on the opposite hand, may very well be lethal earnest: signaling the technological future they consider is coming to cross — e.g., international and decentralized.
Whatever the explanation, it appears truthful to say that social media has been tilting Bitcoin’s (BTC) worth proposition lately, and it raises some questions. For instance, are cryptocurrencies extra inclined to social media messaging than different monetary belongings?
BTC and social media — Joined on the hip?
Rightly or wrongly, many customers choose BTC’s success by its each day market value, and that value appears extra entangled than ever with social media exercise.
“Absolutely,” Feng Mai, an assistant professor at Stevens Institute of Technology’s School of Business, commented to Cointelegraph. “My research has shown that Twitter posts from influencers have an immediate effect on BTC pricing.” This is for 2 causes, Mai defined: “Its lack of intrinsic value compared to other financial assets, and its adopters’ demographics overlapping with social media users.”
Neil Wilson, chief market analyst for Markets.com buying and selling, added that cryptocurrencies — like another belongings that occupy comparatively small pockets throughout the general investing market, e.g., GameStop — appear notably weak to social media as a result of they’re comparatively illiquid with giant holdings within the palms of comparatively few folks, and additionally as a result of they’ve “a crowd/cult following.”
Lennard Neo, head of analysis at Stack Funds — a crypto index fund supplier — informed Cointelegraph that whereas social media doesn’t change BTC’s “foundational value proposition,” which stays strong, “the tweets act like accelerators.”
Finn Brunton, professor of science and expertise research on the University of California, Davis and writer of Digital Cash: The Unknown History of the Anarchists, Utopians, and Technologists Who Created Cryptocurrency, informed Cointelegraph BTC and social media have been intertwined since Bitcoin’s origins.
According to him, “Bitcoin has always been a social media movement first and a working currency second — driven by testimonials, stunts, memes and exhortations to HODL and believe.” In that sense, the worth of BTC skyrocketing as a result of a voguish CEO modifies their Twitter bio “is completely on brand.”
Is superstar consideration good for BTC?
On the face of it, the well timed addition of #Bitcoin to the Twitter bios of tech CEOs, resembling Dorsey, Ohanian and Musk, would appear to be a plus, garnering extra consideration for Bitcoin and finally growing acceptance and adoption. Wilson informed Cointelegraph:
“The emerging corporate support we are seeing for Bitcoin is very important in the price resurgence over the last few months. Tesla’s move is the kind of big corporate support that bulls are latching on to. More corporate support equals more mainstreaming, greater acceptance. Network effect is key here.”
“Musk and Tesla embracing Bitcoin is good news for the cryptocurrency,” Mai added, “in that it lends credence to cryptocurrency as a medium of exchange, which is one of the key functions of money according to economists.”
But don’t these social-media turbo expenses additionally make BTC’s value extra erratic — with volatility lengthy being cited as one of many cryptocurrency’s primary drawbacks? When billionaire Salinas, Mexico’s third-wealthiest man, added #Bitcoin to his Twitter bio at the beginning of February, as an illustration, the worth of the highest crypto asset surged over $40,000 for the primary time in 23 days.
Mai answered that the entry of huge companies like Tesla greater than offsets any short-term volatility, and the massive firms will make Bitcoin much less risky: “The firms that accept BTC should now have more incentive to stabilize the value of BTC — they do not want their revenue fluctuating significantly day-to-day.”
Regarding the latest hash-tagged bios, Brunton, not precisely a BTC bull, commented: “It’s good for Bitcoin in that more buy-in from rich guys equals more parties invested in keeping this leaky raft afloat.” In his view, a greater long-term end result, nevertheless, could be for customers emigrate from BTC to cryptos “that work better, are better engineered, or have superior implementation.” Bitcoin, he added, “is the alpha rollout of what cryptos could be, so the more sunk cost there is, the longer we’ll be stuck with it.”
Not only a Musk whim?
When Elon Musk added #Bitcoin to his Twitter bio on Jan. 29, the impact on BTC was flammable — the price rallied 14% within the first half-hour. But not all followers had been completely clear concerning the world’s richest man’s intent. Was he simply joshing together with his 43 million Twitter followers? The addition of a cryptic tweet — “In retrospect, it was inevitable” — solely deepened the anomaly.
The image grew to become clearer, nevertheless, on Feb. 8 when it was extensively reported that Tesla had lately bought $1.5 billion of Bitcoin, which is but to be revealed. Obviously, Musk’s curiosity in BTC had been real. Musk has since eliminated #Bitcoin from his Twitter bio. Wilson informed Cointelegraph:
“Now we know not only is Musk on side but Tesla is backing on a corporate level — the strategy was approved by the board and audit committee. This is important since it is not just a Musk whim but a ‘serious’ corporate investment.”
Brunton was much less tolerant of Musk, whom he referred to as an “A-1 s—poster who also happens to be a billionaire.” That stated, in response to him, “#bitcoin is definitely part of the Reddit-style starter pack of tech-baron lifestyle trappings and displays. That’s about a culture and a scene, though. It has nothing to do with ‘technology’ as such.”
Elsewhere, it’s been prompt that Bitcoin-hash-tagging CEOs had been simply using social media to advertise “their brand as a crypto-friendly firm and getting a ton of free publicity.” Neo, for his half, believes that markets are at the moment overextended, “and there are definitely revolters out there who are just tweeting for ‘fun’ at people’s expenses.” During such occasions, “it is even more crucial that we exercise caution, invest rationally and not emotionally,” he informed Cointelegraph.
Is Bitcoin expertise’s new flag?
Meanwhile, Balaji Srinivasan, angel investor and co-founder of Coin Center — a nonprofit crypto coverage advocate — previously has suggested that Bitcoin is turning into the new “flag of technology” representing high-echelon financial values resembling decentralization and internationalism.
Among the implicit values in Bitcoin’s expertise, as he wrote elsewhere, are: “internationalist, capitalist, decentralized, hyperdeflationary, networked, encrypted, digital, volatile, ambitious, and quietly revolutionary.”
So, is that what goes on with the #Bitcoin motion: CEOs simply waving the new “flag of technology,” wanting to establish themselves with a nonetheless coalescing decentralized future?
“It [BTC] is the flagship of all cryptocurrencies and represents the many values inherent in the technology,” answered Jay Hao, CEO of OKEx crypto change, although it usually means various things to totally different folks:
“It may represent freedom for one person, efficiency for another […] a life raft, a speculative asset, a store of value and so on. A person who has seen his life savings wiped out by hyperinflation and is using BTC as a means of shielding future wealth will see the flag of Bitcoin differently from a day trader or institutional investor.”
Wilson informed Cointelegraph: “I think Bitcoin has always been a movement to an extent — it’s about decentralization and ‘taking back control’ from central banks, governments, etc.” Dallas Mavericks proprietor Mark Cuban went even additional, telling Forbes in December that Bitcoin is “more religion than solution to any problem.”
A social motion with shared high-level beliefs? Brunton remained skeptical: “Bitcoin is — and has always been — multiple conflicting social movements awkwardly kludged together around a currency and a transaction infrastructure.” He additional added that beliefs round what Bitcoin is are totally different for folks like speculators, libertarians, anti-statists and so on, concluding: “To say that anyone holds common beliefs by holding BTC is a category error.”
Neo informed Cointelegraph: “Flag or not, to the masses out there, it isn’t just a matter of investment but also a statement that they support the particular ecosystem or an asset.”
On the journey to mass adoption
Whatever the reason behind the proliferation of #Bitcoin in Twitter bios, most Bitcoinists are most likely inspired by it, whereas acknowledging that it stays a sideshow at greatest.
As Hao informed Cointelegraph, BTC “has been gaining traction steadily over the years — long before leading business executives arrived ‘late to the party.’” The hashtags are a “nice gesture,” one other signal that BTC is turning into a motion, however ultimately, Hao added, that is simply one other step alongside the “journey to mass adoption.”