The effect that billionaire Elon Musk's words had on Bitcoin and Dogecoin prices over the past three months was analyzed in the “The True Value of Influence” report released by brokerage eToro and analyst firm The TIE. The study showed how the “Elon Musk effect” — the power of the entrepreneur to influence the price of an asset — has been much more positive for DOGE than for BTC. While the price of the cryptocurrency meme rose an average of 8.4% in the 24 hours following the billionaire's tweets published in the second quarter of this year, bitcoin fell an average of 1.6% after Musk made his opinion of the currency public. Three tweets from May caused the BTC's worst downfall. The first is on May 12, when the entrepreneur announced that the Tesla would no longer accept bitcoin payments due to the use of fossil fuel in currency mining, resulting in a 9.4% drop in assets that day. In addition to hurting prices, the tweet caused investor sentiment to drop from 43 points (low) to 21 points (very low), while boosting the volume of tweets about the currency in the period by 150%. Less than a week later, on the 16th, Musk once again drove the BTC down 7.6% after complaining about the centralization of currency mining. The biggest drop came on May 20, when the businessman said that bitcoin mining exceeds the energy use of medium-sized countries, causing an 11.3% devaluation of the asset in 24 hours.
Other tweets from the entrepreneur had a positive effect on the price of bitcoin, although the impact was less significant. Among the three biggest BTC valuations attributed to Elon Musk is an April 26 tweet when Tesla sold part of its bitcoin reserve to prove the currency's liquidity, which resulted in a 2.4% increase. On May 17, the cryptoactive grew 6.4% after the businessman stated that his electric car manufacturer is still holding BTC in the treasury. BTC rose another 8.1 percent when Musk promised Tesla would return to accepting bitcoin payments when half of the miners are using renewable energy.
To clarify speculation, Tesla has not sold any Bitcoin— Elon Musk (@elonmusk) May 17, 2022
In addition, the bitcoin-focused entrepreneur's tweets resulted in an overall growth of 44.4% in comments about the asset on social media. The cryptocurrency meme Dogecoin was able to take full advantage of Elon Musk's support. On April 14, for example, DOGE rose 125% after he posted an image captioned “Doge barking at the moon”. On May 13, Dogecoin rose another 40% shortly after the entrepreneur claimed he was working with the currency's developers. Elon Musk also boosted the trading volume of both assets. In the 24 hours after a tweet by the entrepreneur, the volume of bitcoin increased by an average of 44% and that of Dogecoin, 99.7%.