- Musk’s tweets fueled uptrends, notably in Dogecoin, Shiba Inu, and PEPE
- Memecoins’ volatile nature has led many to question its long-term viability
Within a day of Ethereum [ETH] spot exchange-traded funds (ETFs) being approved, Dogecoin [DOGE] and Shiba Inu [SHIB] fell significantly on the charts, falling by 5% and 65% respectively.
However, just when it seemed that these memecoins were down and out, tech magnate and meme lover Elon Musk once again rescued them.
Musk: The memecoin lover
In a recent X post, Musk paid tribute to Kabosu, the original dog behind the Dogecoin meme, who inspired the creation of DOGE in 2013.
Source: Elon Musk/X
Musk’s post sparked a bullish trend for both memecoins. DOGE, at the time of writing, was up by almost 5% while SHIB was valued at $0.00002488 following an uptick of 4.5% in 24 hours.
Meanwhile, Dogecoin’s social volume and dominance data from Santiment confirmed that Musk’s tweet contributed to a hike in its social dominance and social volume. However, this surge was short-lived as both social dominance and volume have dropped significantly since.
Source: Santiment
This isn’t the first time!
Elon Musk’s tweets have consistently had a significant influence on Dogecoin, a trend that has been evident since 2020.
In 2024 alone, Musk’s endorsement of DOGE has been a key contributory factor to its impressive 68% surge since the year began.
In addition to Dogecoin and Shiba Inu, Musk also tweeted about Pepe [PEPE], a frog-themed cryptocurrency, on 15 March. This tweet on X piqued the curiosity of his followers, underlining Musk’s impact on the cryptocurrency market. As expected, the tweet led to a remarkable 23% hike in the memecoin’s price, followed by a significant decline.
Why are memecoins so speculative?
This raises the question – Why are memecoins so sensitive to mere tweets and endorsements?
Memecoins are essentially real-world jokes tokenized on the blockchain, which thrive on speculation much like regular internet memes. Similar to traditional memes, their value skyrockets with increased chatter in online communities.
Hence, memecoins’ long-term viability is uncertain as they’re highly volatile, when compared to other cryptocurrencies. A single tweet from a key influencer can swiftly shift their prices, making them even more unpredictable than other cryptocurrencies.
Interestingly, this time Musk’s tweet not only impacted DOGE, SHIB, and PEPE but also contributed to an overall increase in the memecoin market cap. It stood at $64.3 billion at press time, reflecting a +2.7% change in the last 24 hours, as per CoinGecko.