Study: How do Elon Musk Tweets and Twitter Bot Spam Affect Altcoin Prices?

According to a study by the Network Contagion Research Institute (NCRI), published on August 2, over 3 million tweets involving 18 altcoins, posted from Jan. 1, 2019, to Jan. 27, 2023, were analyzed. 

The study focused on the impact of Twitter bot activity on the value of cryptocurrencies listed on FTX. Four cryptocurrencies, including The Sandbox (SAND), Gala (GALA), Gods Unchained (GODS), and LookRare (LOOKS), were found to be significantly impacted by Twitter bot activity.

The study found that unauthenticated tweets increased after FTX posted about the token on social media. This raises questions about whether FTX or Alameda Research could have played a role in coordinating bot activity. The study suggests that inauthentic networks have been used deliberately to influence changes in the value of FTX cryptocurrencies.

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The study raises questions about whether FTX or Alameda Research engaged in coordinated inauthentic activity on social media to artificially inflate market values. For half of the FTX-listed coins in the sample, inauthentic tweet volume showed signs of forecasting subsequent prices.

How do Musk’s tweets impact PSYOP and PEPE?

In addition, the study examined the impact of bot activity and Elon Musk’s tweets on two recent memecoins, revealing that both Pepe (PEPE) and PSYOP prices were influenced by these factors.

Before the launch of PEPE, NCRI identified a surge in newly created bot accounts, all of which proceeded to tweet about either of these two memecoins.

The study indicated that the rise of Pepe Coin and PSYOP was further fueled by two tweets from Musk.

Within 24 hours of Musk’s tweet about the Pepe meme on May 13, the token’s price surged by over 50%.

In addition to Musk’s tweets, there were notable spikes in account creation a day before the April 17 launch of Pepe, indicating a coordinated attempt to utilize bots for enhancing the token’s popularity.

The researchers of the study noted that this phenomenon could also impact stocks and other securities. They referred to the social media craze in 2022 that surrounded “meme stocks” like GameStop and AMC.