We figured out how much power Elon Musk holds over Dogecoin
Every time Elon Musk tweets about cryptocurrency, Crypto Twitter™ loses its collective mind.
Mostly, Musk tweets about Bitcoin, but he’s also discussed altcoins Ethereum and Dogecoin — prompting some insiders to gush at the thought of Tesla’s chief exec mentioning their crypto project next.
That’s because Musk’s Twitter timeline appears to have a big impact Dogecoin’s price. A month ago, he tweeted “One word: Doge,” and its price jumped 20% soon after.
But how much power does Musk really wield over the cryptocurrencies he mentions on Twitter?
Some outlets already tried to quantify the Musk Effect using Google Trends — but we wanted to answer the question once and for all with real data.
Dogecoin, Musk’s favorite
Protos analyzed the price of Dogecoin after every time Musk mentioned the meme-inspired crypto on Twitter.
- Dogecoin’s price increased every time Musk tweeted about it (the day of the tweet, and after one week, and after one month).
- Musk’s first Dogecoin tweet (“Dogecoin might be my fav cryptocurrency”) seems to have had the biggest impact.
- Two days later, DOGE was up 62% and its trade volume had tripled.
Next biggest impact appears to be in November last year, when Musk joked that Tesla insiders refer to one of its chips as ‘Doge.’
On that day, DOGE was worth $0.002908, but one week later it traded for 0.004202 — a 45% boost.
But Bitcoin was pretty healthy back then too, which could explain DOGE’s rally without relying on Musk.
Ethereum
Ethereum appears in Musk’s timeline on one fewer day than Dogecoin.
- Ethereum’s price only saw a marked improvement after two of Musk’s tweet storms.
- His three tweets about Ethereum on April 30, 2019 seem to have done the most.
- A week later, ETH was fetching up to 14% more. After one month, it had rallied more than 70%.
If Musk really does influence Ethereum, then the ‘world’s richest billionaire’ actually tanked its price by tweeting about it in August 2018.
ETH fell 11% on the day Musk tweeted “ETH beam heheh,” in reply to an article from ETH Zurich university.
[Read more: How Grayscale’s cryptocurrency portfolio grew $25B in one year]
After a week, the number two crypto closed 15% below the day before Musk’s tweet, and by one month later it was down 35%.
Bitcoin
Musk has tweeted about Bitcoin more than the other two cryptocurrencies.
- Bitcoin’s price went up after five of Musk’s BTC-related tweet storms.
- His first Bitcoin tweet appears to have made the biggest jump (25% in one week) — but it came about half way through BTC’s enormous rally to $20,000.
- Tweets in February 2019 seem to have had a delayed reaction. BTC traded evenly for one month, but after four months it had more than tripled.
Ultimately, Musk likely influences Dogecoin more as it’s a smaller cryptocurrency with less liquidity.
DOGE’s market cap is just $1.1 billion, under 0.002% of Bitcoin’s. Sudden influxes in demand can temporarily boost its price — which explains why DOGE went up every time the SpaceX guy tweeted about it.
It’s however important to note that correlation does not imply causation. So, take this ‘research’ with a grain of salt: this is not investment advice.