Dogecoin Dumps By 20% Following Elon Musk Tweet

Elon Musk’s latest tweet on Dogecoin has corresponded to a 20% drop in the token price. Musk, in the tweet, suggested that most Dogecoin token holders should sell their holdings.

General Crypto Market Decline

This drop in prices coincides with the general decline in the cryptocurrency market. Bitcoin (BTC) fell 5%, while Ethereum (ETH) fell 8%. However, DOGE’s decline was substantial when it fell 25% from its daily opening price.

This all happened before Musk tweeted:

If major Dogecoin holders sell most of their coins, it will get my full support. Too much concentration is the only real issue imo.
— Elon Musk (@elonmusk) February 14, 2021

Musk is an ardent supporter of cryptocurrencies, especially Doge, and has repeatedly tweeted the meme token in recent weeks. His tweets alongside the switch of Reddit based speculators to Doge has pumped the token.

The influx drew Zhao Changpeng, CEO of Binance, attention. He decided to face the pump head-on, highlighting the potential pitfalls the DOGE community might face.

Zhao tweeted on Twitter:

Some pros/risks of #Doge.

Pros: Cool, fun, PR manager @elonmusk. Decentralized in the sense there are no "core team". It's abandoned.

Risks:
1 address holds 27% of all #DOGE.
Top 20 addresses holds more than 50%+ of all #DOGE
Kinda "centralized" in that sense.
"abandoned".
— CZ 🔶 Binance (@cz_binance) February 4, 2021

With a single address containing more than 25% of the total supply and the next 19 largest addresses containing an additional 25% or more of the tokens, DOGE may not be as decentralized as owners and speculators would like.

Investors Attention on Elon Musk’s Action and Not Words

Interestingly, Musk has posted many tweets on Twitter (Doge), but he doesn’t seem to know anything about meme currency. Whether he has fun, juggling, or tweeting, Musk has clearly shown which cryptocurrency he prefers by putting his money where his mouth is. Telsa made a large-scale Bitcoin acquisition but didn’t have a DOGE.

Although high-tech billionaires and geniuses make frequent mention of the project, investors and speculators need to pay attention to Musk’s actions, not just his words. By the time Musk watched the retailer FOMO pour into DOGE, he had steadily amassed bitcoin.

Disclaimer: The information in this article should not be considered financial advice, and FXCryptoNews articles are intended only to provide educational and general information. Please consult with a financial advisor before making any investment decisions.