Dogecoin prices have a history of rising and falling on the whims of Elon Musk.
Dreamstime
Dogecoin
tumbled on Friday after Twitter changed its homepage logo back to the blue bird, ditching as an icon the Shiba Inu dog that represents the meme cryptocurrency and putting an end to a rally in prices.
The price of Dogecoin has fallen 9% over the past 24 hours, having now dropped almost 20% since the peak hit earlier this week after Twitter changed its logo to that of the Shiba Inu icon late on Monday. Prices are now some 5% above where they were before Twitter’s surprise move, which kicked off a rally that saw the so-called memecoin surge to outperform
Bitcoin
and other digital assets.
Initially launched as more of a reference to an internet joke than as a significant blockchain project, Dogecoin—which refers to a meme involving a Shiba Inu dog, or “doge”—has found a fan in
Tesla
(ticker: TSLA) CEO Elon Musk, who also owns Twitter. Musk has dubbed himself the “Dogefather” and toyed with the crypto’s price for years through references via Twitter and on television.
Dogecoin has seen a number of rallies since Musk—a high-profile crypto fan—bought Twitter last year, mostly amid hopes that the social media platform under control of the billionaire could bring new life to the jokey digital asset.
Twitter released a tipping function in 2021 allowing users to pay content creators in Bitcoin, and Dogecoin bulls—buoyed by a move by Tesla to accept the crypto for some merchandise payments—have been hoping for more of the same. It’s also been floated that users could make negligibly small payments in Dogecoin to comment on Twitter, in a move that could help crack down on spam bots on the platform.
There had been few indications that a crypto push at Twitter was picking up steam, but the move to make a Shiba Inu dog Twitter’s logo this week was an encouraging—albeit purely symbolic—development. But now Dogecoin optimism seems to have faded as quickly as it began this week, dragging prices down in turn and burning traders.
The brunt of the move higher came after the logo switch late Monday, and it never got much better than that. Bullish traders who had bid up Dogecoin in the highly liquid crypto futures market have had positions worth almost $250 million liquidated—or forcibly closed out by their brokers—since Monday, according to crypto data provider Coinglass. That’s far more than bearish traders who had taken opposite bets.
Yet again, fading the memecoin rally seems to have been the smart play.
Write to Jack Denton at [email protected]
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