Have you too noticed that in today’s world, a bag full of cash doesn’t appeal to people as much as cryptocurrency does? It is all anyone can talk about these days. People have an increased desire to buy Ethereum and Bitcoin. The way crypto has risen in everyone’s eyes is quite curious, isn’t it? I’m sure you won’t be surprised when I tell you that social media has a lot to do with this. But, this might make you wonder, what is the role of social media in changing crypto prices?
Well, this article is going to be all about the relationship between social media and its impact on the crypto industry. If this is something that you wish to know more about, keep scrolling!
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The Role Of Social Media In Changing Crypto Prices
Over time, social media has become a one-stop destination for all discussions and information exchanges related to cryptocurrency. Much of what people know about crypto is because of the posts they see on social media platforms. There used to be many myths attached to using crypto as a mode of payment. Discussions held on platforms like Twitter and Reddit helped put an end to them, thereby making people less hesitant about using crypto.
On top of that, social media platforms are where people exchange information on market trends and developments in the crypto industry. Discussions are held on all kinds of topics related to crypto, like top-rated sites for buying Crypto, how it can be used for payments, etc. This increases people’s knowledge, thereby helping them understand it and its usage better.
Positive discussions, endorsements, and news regarding a particular cryptocurrency can lead to an increase in its demand, thereby causing the price to rise. Similarly, negative news and publicity can deteriorate the value of a currency and even make buyers dump their holdings.
The Rise Of Crypto Influencers
Believe it or not, social media and crypto have given rise to a new profession—crypto influencers. Think of them as chefs in a kitchen full of cooks. They have a large following on social media, and their opinion on all things crypto matters. They are seen as reliable sources of information, and so people turn to them when they need advice on anything related to crypto.
This means that crypto influencers also greatly influence how things work in the crypto industry. For example, the value of cryptocurrencies can fluctuate because of their opinions. This stands particularly true for minor altcoins. This happens because people literally decide what cryptocurrency they should use/ invest in on the basis of their advice.
However, given that there’s no barrier to entry in this industry, literally, anyone can gather a large following and assume the role of a crypto influencer, regardless of the level or depth of their knowledge. On top of that, even the most legit crypto influencers can sometimes cause market manipulation and scams wherein they artificially increase the original price and make profits.
Memes On Cryptocurrency
You must be thinking, what have memes got to do with all of this? Well, those seemingly innocuous memes play a crucial role in affecting Bitcoin prices and influencing market movement. This is because, over time, memes have become a popular and preferred method of communication and expression.
Memes convey the status of cryptocurrency in the most fun way and also generate excitement about developments and/ or breakthroughs in the field. This might sound absurd, but a cryptocurrency’s value can be influenced by how popular the memes made on it can get. For example, if a meme made on a particular cryptocurrency gets viral, the excitement around it increases, therefore increasing its value as well. However, once the excitement subsides, the prices can also fall equally sharply.
For example, within two days of PEPE’s launch, its value increased 400% on the charts and became way more than that of its meme competitors, Shiba Inu and Dogecoin.
Some memes are made in a way that they not only facilitate the understanding of different kinds of cryptocurrencies but also makes the process fun.
Fear Of Missing Out (FOMO)
Memes, crypto influencers, all the discussions that are held on various social media platforms, etc., create an urgency among users to experiment with crypto. They make them feel like by not dabbling with crypto, they are missing out on something extremely important. People not participating in discussions around crypto are made to feel left out/ like outcasts.
And so, a hell lot of people try investing in cryptocurrencies purely out of Fear of Missing out, aka FOMO. They are made to believe that investing in cryptocurrencies is the new profitable trend, and by not investing in them, they are uncool.
What further adds fuel to the fire are tweets and posts by other famous people trying out crypto. By famous, I’m not talking about random crypto influencers, but people like Elon Musk.
In April 2021, one of Musk’s tweets about Dogecoin triggered a market frenzy causing its value to skyrocket. Musk shared “Doge Barking at the Moon,” and that was it. Within a single day, Dogecoin gained 176% percent more value, thereby going from $0.1700 to $0.4706.
So, what is the role of social media in changing crypto prices? Well, we’ve reached the end of this article, and so I hope you have understood how these two are related. Social media can effectively cause changes in the crypto industry. Some factors can make the value of a particular cryptocurrency skyrocket, while others can make them fall sharply. Armed with all the information mentioned above, I hope you will be able to make smarter decisions when it comes to crypto and not take everything you see on social media at face value!