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

  • Crypto-spouting Twitter bots could be artificially inflating the price of altcoins, according to a new study.
  • A sample of FTX-listed cryptocurrencies was analyzed, revealing that Twitter bot activity played a crucial role in boosting the value of these coins.
  • The study also found that inauthentic tweets increased after FTX posted about the token on social media, raising questions about coordinated bot activity.
  • Elon Musk’s tweets were also found to impact the prices of memecoins Pepe and PSYOP.
  • Surges in newly created bot accounts were observed prior to the launch of Pepe, suggesting an orchestrated effort to amplify the token’s popularity.
  • The researchers suggest that this phenomenon could also affect stocks and other securities, citing the social media frenzy surrounding meme stocks in 2022.

A new study conducted by the Network Contagion Research Institute (NCRI) has suggested that Twitter bots may have a significant influence on the prices of altcoins. The study analyzed over 3 million tweets involving 18 altcoins that are listed on FTX. It found that Twitter bot activity played a crucial role in amplifying the value of these cryptocurrencies.

Specifically, the study identified four altcoins that showed signs of price influence as a result of tweet bot activity. These coins are The Sandbox (SAND), Gala (GALA), Gods Unchained (GODS), and LooksRare (LOOKS). Half of the FTX listed coins in the sample demonstrated signs of forecasting subsequent price due to inauthentic tweet volume.

Interestingly, the study also observed that inauthentic tweets would increase following FTX’s posts about the tokens on social media. This raises questions about whether FTX or Alameda Research, a company associated with FTX, could have coordinated the bot activity to artificially inflate market values.

In addition to the impact of tweet bot activity, the study also looked into the influence of Elon Musk’s tweets on memecoins Pepe and PSYOP. The researchers found that there was a surge in newly created bot accounts prior to the launch of Pepe. This indicates a potential orchestrated effort to use bots to amplify the popularity of the token. Musk’s tweets were also found to have a significant impact on the price of Pepe, with a single tweet causing the token’s price to jump over 50% within 24 hours.

The researchers behind the study suggest that this phenomenon of Twitter bot spam and influential tweets from high-profile individuals like Musk could also affect stocks and other securities. They point to the social media frenzy surrounding meme stocks like GameStop and AMC in 2022 as an example of how online activity can significantly impact market values.

Overall, this study sheds light on the potential manipulation of altcoin prices through Twitter bot activity and influential tweets. It emphasizes the need for investors to be cautious and critical when evaluating the market based on social media activity.

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