- Tesla’s CEO Elon Musk has sent a tweet about DeFi that could be construed as a positive endorsement.
- Barely hours after the tweet, the value of DeFi tokens spiked as market capitalization soared.
- The impact of Elon Musk’s tweets on cryptocurrencies has been profound, as previous tweets have all sent Bitcoin and Dogecoin on strong price rallies.
- DeFi refers to an ecosystem of financial applications that have their foundation rooted in blockchain networks.
Elon Musk caused a major buzz in the cryptocurrency world after he recently tweeted about DeFi. A three-word tweet saying “Don’t defy DeFi” was all it took to send the value of DeFi through the roof, with market capitalization rising to $79.49 billion.
Before Elon Musk’s tweet, DeFi was on a poor run. Some analysts have construed the tweet as giving hope to the DeFi faithful, while others believe that Elon Musk was simply trolling DeFi.
Does Elon Musk Believe In DeFi?
Tesla’s CEO was named the world’s richest man in 2021 and is a prominent figure in the cryptocurrency industry. His unorthodox method of communicating with his fans has endeared him to over 49 million followers on Twitter.
On the 25th of March, his tweet, “Don’t defy DeFi,” went viral with over 160,000 likes and 16,000 comments, sending DeFi tokens and market capitalization on a positive run to an impressive $79.49 billion.
DeFi believers have construed the tweet as an endorsement of the tokens because of Elon Musk’s habit of regularly tweeting about what he believes in.
Prior to this, Elon Musk let the world know of his affinity with Dogecoin through his regular tweets, such as “One word: Doge,” and by sharing memes of the cryptocurrency’s mascot. His tweets sent Dogecoin on the strongest price run of its history, rising by over 1,000% to trade at $0.08495.
Similarly, his tweet about Tesla (NASDAQ:TSLA) accepting cryptocurrency payment for its cars also caused movement in the price of Bitcoin. The announcement in February that Tesla had purchased $1.5 billion worth of BTC opened the floodgate of institutional and corporate buy-in for Bitcoin, sending cryptocurrencies to new highs.
Based on the above, it is safe to assume that Elon Musk has set his target on the nascent area of decentralized finance after previous escapades with Bitcoin and Dogecoin.
On the Flipside
- New York-based crypto exchange Gemini has expanded its roster of supported tokens for trading.
- The new move is clearly focused on DeFi and NFTs.
- The new additions include “DeFi-related tokens for 1inch Exchange (1INCH) and Bancor (BNT), blockchain infrastructure tokens SKALE (SKALE), The Graph (GRT), and
- Loopring (LRC), and gaming-centric tokens Enjin Coin (ENJ) and The Sandbox’s in-game SAND currency.”
Is Elon Musk Trolling DeFi?
While many have taken the recent tweet as an indicator of interest, some remain skeptical about Elon Musk’s intentions. They believe that the tweet could merely be trolling DeFi, following the price drops that have hit DeFi tokens.
Before the tweet, DeFi tokens such as Uniswap’s UNI, AAVE, and SUSHI were down by over 10%, and some believe that Elon Musk’s tweet was intended to tease the struggling DeFi tokens.
Some have cited the wordplay and alliteration used in the message as evidence that Musk is trolling DeFi. But an examination of his usual communication style shows that wordplay, light jokes, and memes are often his way of showing support.