Elon Musk tweets and Twitter bot spam influences altcoin prices: Study

Together with Musks tweets, account production surges took place a day prior to Pepes April 17 launch which suggested a managed effort to use bots to amplify the tokens appeal. Chart revealing a substantial surge in bot accounts a day prior to Pepes launch.

Crypto-spouting Twitter bots might be playing a much bigger role in synthetically pumping up the price of altcoins than previously comprehended, a new research study has suggested.Using a sample of various FTX-listed cryptocurrencies in a study published Aug. 2, the Network Contagion Research Institute (NCRI) said it analyzed over 3 million tweets published in between Jan. 1, 2019, to Jan. 27, 2023, surrounding 18 altcoins.The study found that Twitter bot activity played an important role in magnifying the worth of these cryptocurrencies, consisting of The Sandbox (SAND), Gala (GALA), Gods Unchained (GODS) and LooksRare (LOOKS), with half of the coins showing signs of rate influence as a result of tweet bot activity. It also found that these inauthentic tweets would increase after FTX published about the token on social networks, which it said raises questions about whether FTX or Alameda Research could have contributed in collaborating the bot activity. Each line shows the average variety of botted tweets, which increased following FTXs listing and reference. Source: NCRI” In fact, for half of the FTX noted coins in the sample, inauthentic tweet volume showed indications of forecasting subsequent price. This suggests that inauthentic networks successfully and intentionally released to affect modifications in FTX coin prices,” it stated, including: ” It asks the concern, did FTX or Alameda engage in collaborated inauthentic activity on social networks to synthetically inflate market values?” Musks tweets impact PSYOP and PEPEThe study also looked into the impact of bot activity and Elon Musks crypto-adjacent tweets on two recent memecoins, suggesting the rates of Pepe (PEPE) and PSYOP have been affected by both these factors.NCRI detected a surge of recently developed bot accounts prior to the launch of PEPE– which all went on to tweet about one of the two coins.Pepe Coin and PSYOP leveraged memes and were likewise boosted by 2 of Musks tweets that apparently provided a nod to each of the tokens, the research study said.Related: Xs ad revenue sharing: Crypto payments on the horizon?Musks May 13 tweet of a Pepe meme caused the tokens price to leap over 50% within 24 hours.Explaining Constitutional Amendments pic.twitter.com/oYkMPBe9Zi— Elon Musk (@elonmusk) May 13, 2023

Other Questions People Ask

How do Elon Musk tweets and Twitter bot spam influence altcoin prices according to the study?

The study conducted by the Network Contagion Research Institute (NCRI) indicates that Elon Musk's tweets, combined with Twitter bot activity, significantly impact the prices of various altcoins. By analyzing over 3 million tweets related to 18 altcoins, the research found that bot activity often surged following Musk's tweets, leading to price increases for coins like The Sandbox and Gala. This suggests a coordinated effort to amplify the appeal of these cryptocurrencies through social media manipulation.

What role do Twitter bots play in the price movements of altcoins influenced by Elon Musk tweets?

Twitter bots have been shown to play a crucial role in artificially inflating the prices of altcoins, particularly in conjunction with Elon Musk's tweets. The NCRI study revealed that for half of the FTX-listed coins analyzed, an increase in bot-generated tweets preceded price changes, indicating a predictive relationship. This highlights the potential for inauthentic accounts to create a synthetic demand for cryptocurrencies, thereby influencing market values.

What specific examples from the study illustrate the impact of Elon Musk tweets on altcoin prices?

The study highlighted a notable example involving Pepe Coin (PEPE), where a tweet from Elon Musk featuring a Pepe meme resulted in a price surge of over 50% within 24 hours. Additionally, the research noted that bot accounts surged prior to PEPE's launch, suggesting a strategic effort to promote the coin through social media. This correlation between Musk's tweets and price movements underscores the significant influence of social media on cryptocurrency markets.

Did the study find any connections between FTX and Twitter bot activity related to altcoin prices?

Yes, the study raised questions about whether FTX or Alameda Research may have engaged in coordinated bot activity to manipulate altcoin prices. It found that inauthentic tweet volumes increased after FTX listed certain coins, suggesting a potential link between exchange promotions and bot-driven price inflation. This connection emphasizes the need for transparency in cryptocurrency trading and the influence of social media dynamics on market behavior.

How can investors protect themselves from the effects of Elon Musk tweets and Twitter bot spam on altcoin investments?

Investors can safeguard their investments by conducting thorough research and not solely relying on social media trends or celebrity endorsements like those from Elon Musk. Understanding market fundamentals and analyzing genuine trading volumes can help differentiate between authentic interest and artificially inflated prices due to bot activity. Additionally, staying informed about potential manipulative practices in the crypto space can empower investors to make more informed decisions.

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