Elon Musk based meme coins see short-lived frenzy

Debangana Ghosh | | Updated on: Apr 28, 2022

Players hopeful that Twitter’s acquisition by Musk will boost adoption of crypto and NFTs

Meme crypto tokens named after Elon Musk saw a big jump in valuations after the announcement of the Tesla tycoon’s Twitter buyout on Tuesday. Some of these coins included Elon Buys Twitter (EBT), Doge Elon Mars, Elon GOAT, Floki Musk and ElonHype. According to a site called CryptoMarketCap, EBT zoomed over 10,500 per cent in valuation.

Meme coins are cryptocurrencies that associate themselves with an internet joke or pop culture reference.

But it was a short-lived spurt for the meme coins as they faded off by Wednesday. A similar trend was noticed closer home in tokens promoted by Musk such as Dogecoin and Bitcoin (BTC), which saw a spurt and then tapered off. Right after the announcement, Dogecoin was trading up by 25 per cent before correcting soon.

Most top crypto exchanges in India only allow verified and tested crypto tokens to trade.

“Bitcoin experienced a significant correction in the day, taking its price below the $38,000K mark for the first time since mid March this year as the dollar index reached a two-year high. Elon Musk’s takeover of Twitter seemed to have triggered an uptrend in the crypto markets, which, however, was short-lived,” WazirX Trade Desk spokesperson told  BusinessLine.

‘Speculative and risky’

 “Dogecoin had gone up by 25 per cent for some time but corrected again. There have been thousands of crypto currencies around Elon Musk like Shibu, Elon coin and Musk coin, but they are meme coins; they can be speculative and very risky,”  Sidharth Sogani, Founder and CEO, CREBACO Global told  BusinessLine.

The WazirX Trade Desk spokesperson was even more scathing about such currency. “There might be new crypto such as ‘Elon Buys Twitter’ that would have come up and maybe trending presently, but for a reason, such tokens are called shitcoins. These tokens have no value or a perceptible purpose for existing,” he said.

There are over 10,000 crypto assets worldwide, while there are only 200+ listed on WazirX. “There is a listing process where we vet the projects and ensure that only good ones are listed. Hence, investors should stick to trading only in crypto assets that are listed on KYC-compliant exchanges in India,” WazirX added.

CoinDCX’s Minal Thukral, Executive Vice President, Growth and Strategy said, “We have definitely seen some uptick in transaction volumes for coins which Mr Musk is associated with - this includes DOGE, SHIB, etc.” 

Twitter takeover brings hope

Exchanges and crypto ecosystem players are hopeful that Twitter’s acquisition by Musk will boost adoption of crypto and NFTs and mainstream them.

Sathvik Vishwanath, co-Founder & CEO, Unocoin, told  BusinessLine, “Musk has been a promoter of decentralisation and cryptos. Now that Twitter will be under him, we can actually look for payment rails and the NFT part of blockchain to get well utilised. It could eventually mean that anyone can send anyone money across the world just like seeing a tweet or a message.”

Sogani added, “Twitter has always been a crypto pro project as Jack Dorsey has been a key supporter of Bitcoin. Dorsey has now joined Square Capital, a crypto-focussed payment gateway and PoS. Twitter always supported Crypto. In the US, there’s Twitter Blue letting you connect your NFTs to the profile. You can tip users on Twitter with crypto and Dogecoin. With Elon’s takeover more coins will be supported on Twitter.”

“With him taking over Twitter, I believe it will move closer to its vision of free speech by making algos open-source and increasing trust (decentralisation). Secondly, with Twitter being one of the biggest communities for creators globally will enable the adoption of crypto and NFTs via the ecosystem,” Thukral added. 

Published on April 27, 2022
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