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Elon Musk, notorious for his major influence in the crypto globe, has continued to speak out at crypto, making many false claims as the market continues to crash.
Elon Musk's Frenzy On Crypto
Just over the past two days, Elon Musk has made 17 tweets and replies, mostly crypto-related, which you would rarely see with Elon Musk. Before Elon Musk would send a tweet or two on Dogecoin (DOGE) every month to pump it up, but now Elon Musk is sending messages about crypto every day, making some controversial claims. Let's go through some of them.
The first recent crypto mistake Elon Musk made was yesterday about DOGE. In response to a tweet about Elon Musk's preference for DOGE, Elon Musk stated that in the best situation, DOGE speeds block time and increases block size both by 10 times, and drops fees by 100 times, thus making it in this sense a victorious cryptocurrency. However, this brings issues about its use and vulnerabilities.
Within this thread, one person rebutted the claim about DOGE's efficiency, pointing out its vulnerability. The Twitter account states a case, exposing the weakness of the supposed good of DOGE. In this case, mentioned, the person talks about the possibility of spam attacks. In essence, if DOGE has a high processing rate at low fees, it means that the blockchain is vulnerable to unbearable amounts of stress, unable to keep up with the rising usage. Elon Musk responds to this rebuttal, saying that the fees will be balanced by the influx of DOGE transactions. He also mentions that it is needed "to become the currency of Earth," which is virtually impossible, and thus a joke and false claim.
Another case that is much more controversial is in response to centralisation with DOGE.
In another thread, one person states that DOGE is more centralised from its node count and supply distribution in comparison with other cryptocurrencies like Bitcoin (BTC). He also mentions that DOGE is more volatile with whale dumps than BTC, which is more resistant to whale dumps, experiencing them regularly.
In response to this, Elon Musk makes controversial claims about BTC. First, Elon Musk says BTC is "actually highly centralized," which is not true. It is a decentralised currency in its core, powered by thousands and thousands, plausibly even millions, of people, not one organisation like a bank. Elon Musk reasons that BTC is centralised from the great majority of mining made by large mining companies, mentioning the flooding of a Xinjiang coal mine that dropped the BTC hash rate by 35%. Although this may be true, this is not centralisation. These mining companies do not control the BTC blockchain, they only power it. Even if all major mining companies would stop mining, there would be still enough computing power by small businesses and people to keep the BTC blockchain alive. Thus Elon Musk is utterly wrong in this case with BTC, which is disappointing when you think of what great achievements he boasts of.
In another thread within Twitter, Elon Musk mentions that Telsa, the electric motor company which he owns, has not sold any BTC. This is hypocritical for Elon Musk and Telsa, which both aim at making a greener world. If BTC is so impactful for the environment, then why does Elon Musk still hold it, and same with Telsa? This is in response to someone criticising the negativity Elon Musk has had on BTC's trend and nature.
There are still many other cases of controversy with Elon Musk and crypto over the past two days. To find all tweets and replies Elon Musk has made, visit here (https://twitter.com/elonmusk/with_replies).
Things To Consider About Elon Musk
What Elon Musk is doing appears not okay for the crypto market. But the question is why would Elon Musk do this? He is not a dumb person, but a multi-billionaire entrepreneur, and should be familiar with crypto, so why do so many people see him ruining the crypto market? There are multiple reasons for this, which many people may have not realised. Yes, Elon Musk is doing bad, but bad in what? That is the question.
As mentioned before, Elon Musk is no dumb-dumb. He knows what he is doing, he knows the power he holds. If he wanted to Elon Musk could quickly recover BTC. He has done it with DOGE many times before, but he has not done it with BTC. Elon Musk is letting the crypto market crash at a great influence from his side, but it is a great wonder why he is doing this, having a great understanding of his effect. Let me name some reasons.
The first reason is to create diversity in the crypto market. What Elon Musk may be doing is demoting BTC and promoting DOGE, flowing onto altcoins. Just consider the previous alt season. Since DOGE's pump, Ethereum Classic (ETC), Shiba Inu (SHIB), Ethereum (ETH) and many other altcoins have rocketed up in price, making a much more diverse crypto market. BTC used to have over 50% of the market, but now it is under 40%, so there is a more altcoin based market. Maybe Elon Musk is looking towards Ethereum 2.0? Who knows?
Another possible reason is to make a change. Yes, there have been some bad changes with Elon Musk, but what people may miss is the good. Elon Musk may be looking long-term, knowing that if the crypto market is becoming heavily based on BTC, then that indicates a vulnerable market. If BTC falls, then so does everything else. Notice that when BTC fell over today, it was not as bad sometime back with altcoins. At the time of this post, BTC went down by about 8% over the past 24h, but many other cryptocurrencies have begun to recover, such as Theta Network (THETA) and Solana (SOL).
These reasons may be controversial to some, but it is important to consider what Elon Musk is doing. He is no dumb man and has plenty of knowledge with him. Just consider this when thinking about Elon Musk's craziness spreading across the media. There could be a hidden meaning behind it.
Further Reading
Fortune - How much Bitcoin comes from dirty coal? A flooded mine in China just spotlighted the issue - https://fortune.com/2021/04/20/bitcoin-mining-coal-china-environment-pollution/
CryptoPotato - Bitcoin Price Analysis: Is The Current 20% Weekly Drop a Healthy Correction or Sub-40K Coming? - https://cryptopotato.com/bitcoin-price-analysis-is-the-current-20-weekly-drop-a-healthy-correction-or-sub-40k-coming/
DW - Who is Elon Musk, and what made him big? - https://www.dw.com/en/who-is-elon-musk-and-what-made-him-big/a-53591199
CBS News - Why Elon Musk's bitcoin U-turn caused a crypto crash - https://www.cbsnews.com/news/bitcoin-crypto-prices-elon-musk/
