Crypto Dives Following Donald Trump Statement
Here we go again.
Volatility has once again struck among three of the most popular cryptocurrencies as a result of another high-profile and prolific public figure whose reliance on social media has been one of the most poignant parts of his career.
No, it’s not the now infamous Elon Musk, the world’s self-appointed mover of cryptocurrency markets and unofficial spokesman for meme currency who rose in status from eccentric inventor and modern day Caratacus Potts to become the richest man in the world to whom the entirety of cyberspace looks toward when seeking a prediction of the future.
This time, it is his absolute polar opposite: Donald Trump.
The only things Mr Trump and Mr Musk share in common is that they are both vehemently against national lockdowns and pro civil and commercial liberty, and that they both use social media platforms ad nauseum to propagate their often very polarizing opinions.
The latter is where the effect on the cryptocurrency markets can be moved. Not influenced, or discussed, but actually moved.
Today, almost as though the history of last month is repeating itself albeit through the over-used keyboard of a different social media fanatic, Ripple, Ethereum and Bitcoin have all taken a dive in value because of the former US President’s controversial ramblings yesterday.
Mr Trump, unlike Mr Musk, is unable to freely use many platforms, however, as he was banned from using Facebook for two years and is currently also banned from his public address system of choice, Twitter, for whatever arbitrary reasons the Silicon Valley giants could jusify, so instead, as unkeen to be silenced on many controversial matters as he is, Mr Trump took to a more conventional platform to vent his spleen, that being Fox News.
Of course, there was a patriotic bent behind Mr Trump’s rant yesterday, that being his wish to ensure that the US Dollar remains what he considers to be “The currency of the world”, which is especially important at a time during which the Chinese government is playing down the ambitions it has for its own central bank-issued cryptocurrency, the digital Yuan, which is feared by the free market in that it has been assumed that it would become an international version of the Yuan and eventually be used for trade settlements without the need to exchange it against the Dollar.
China’s government said last week that it wants the US Dollar to remain the global de-facto currency for all business, and that the forthcoming digital Yuan is simply a tool for use within the domestic borders of China for private citizens only, as a method of conducting further surveillance and enforcing capital controls in line with government policy.
It is likely that Mr Trump does not believe that to be the case and given his view on China’s perceived expansionist aspirations over the past few years, and his aversion to any form of North American business takeover by the Chinese government, it is in his interests to play one form of challenger currency off against the establishment.
Mr Trump’s anti-cryptocurrency quote made it onto the Fox News network, and as with many of his other comments, especially those during his four years as President, it did not go unnoticed.
Bitcoin dived 9% in value in the following day to the high end of the $32,000 range, which now means that it rests at a significant 12% drop compared to Tuesday last week.
Ethereum took a 10% hit, falling to $2,500 at the beginning of the European market opening today, and Ripple dropped by 11% to well under $1. Even Dogecoin, the darling of Mr Musk, is now at a paltry 32 cents.
Just as the Musk-inflicted flash crash a month ago, speculators and investors are looking closely at this as yet another opportunity.
Speculators this morning on the European side of the Atlantic woke up to the lowered values which sparked enthusiasm among pundits.
One particular analyst’s opinion today is that Dogecoin’s price could get to higher than 70 cents if Tesla begins to accept it as payment. Of course, just as in the crash last month involving five cryptocurrencies, it is not Tesla accepting or not accepting a particular cryptocurrency as payment for an electric car that would move the market that much, its purely the influence it would have.
The talk among analysts is that this would attract more buyers to jump on the bandwagon if a company as influential as Tesla, which is not only a ‘big tech’ influencer but is run by a committed YouTuber who doesn’t stop using his high profile celebrity status to create bandwagonism.
Mr Musk put out the question on social media recently to his 54 million followers “Do you want Tesla to accept Doge?” which was followed up with another tweet confirming he is “working with Dogecoin developers to improve system transaction efficiency”.
This is the way markets are moved these days it seems. Mr Trump and Mr Musk are just two high profile keyboard warriors…. well in Mr Trump’s case former keyboard warrior… who know their influential abilities.
Dogecoin may well be in Mr Musk’s sights, however those now waiting for another rise among all of the other major cryptocurrencies are waiting, shoulders haunched, for the next media-driven movement.
Market makers used to be banks and derivatives exchanges. Now they’re celebrities, eccentrics and public figures, doing so from their cellphone or laptop.
This is very much the modern world.