![]() ![]() Noticeably, the value of Bitcoin and most cryptocurrencies skyrocketed at the beginning of February 2021 when Tesla’s CEO, Elon Musk, announced on Twitter that his company spent 1.5 billion USD to buy Bitcoin. ![]() Musk’s Twitter account has more than 55.7 million followers. Investors started following Musk’s Twitter account in 2021 when he began tweeting about Bitcoin and providing financial advice. Our results are also robust when using a different cryptocurrency, i.e., Ether this paper extends the existing literature about the mechanisms of social media content generated by influential accounts on the Bitcoin market.Ĭurrently, Elon Musk is the wealthiest person in the world (Klebnikov, 2021) however, this information is not surprising enough in the cryptocurrency market. However, we did not find evidence to support linkage between Musk’s sentiments and Bitcoin volatility. In addition, Musk is likely to use positive words in his tweets, and reversal effects exist in the relationship between Bitcoin prices and the optimism presented by Tesla’s CEO. After examining 10,850 tweets containing 157,378 words posted from December 2017 to May 2021 and rigorously controlling other determinants, we found that the tone of the world’s wealthiest person can drive the Bitcoin market, having a Granger causal relation with returns. We present a textual analysis that explains how Elon Musk’s sentiments in his Twitter content correlates with price and volatility in the Bitcoin market using the dynamic conditional correlation-generalized autoregressive conditional heteroscedasticity model, allowing less sensitive to window size than traditional models. ![]()
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