Influencer Marketing Makes Inroads Into the Crypto Sphere

Influencer marketing has also made inroads into the crypto sphere in an attempt to make digital money more visible and respected.

Influencer marketing has extended its reach into the realm of cryptocurrency, aiming to enhance the visibility and appeal of digital currencies. Utilizing renowned influencers, such as Bellychan, in the promotion of a memecoin like Water is bound to garner attention and potential investment. However, the repercussions of such tactics become readily apparent.

The price of the Water memecoin soared by an astonishing +219.76% after Lionel Messi shared an Instagram story featuring the memecoin, highlighting the immense influence that a single statement from a high-profile celebrity can exert on the market value of a cryptocurrency. On-chain metrics, as reported by a platform known as Bubblemaps, were shared via a tweet, indicating that a substantial portion of the Water token supply—30%—is allegedly controlled by insiders.

Following Messi's post on Instagram Stories, the price of WATER has dropped by 48% from its peak. While this phenomenon is not inherently positive or negative, it does raise questions about the importance of sound investment strategies in the rapidly evolving cryptocurrency market and has prompted investors to reconsider the wisdom of investing in memecoins that are endorsed by celebrities.

Elon Musk and Dogecoin

In early 2021, Elon Musk's association with Dogecoin began to take shape, with his abrupt tweets regarding the cryptocurrency having a significant impact on its market performance during this period. Many media reports have suggested that Elon Musk has been acting as an unofficial hype-financier for DOGE since 2019. Through his tweets, whether expressed in jest or support, Musk has been able to create peaks and troughs in Dogecoin prices. For instance, in April 2021, one tweet from him featuring the words “Doge barking at the moon” led to a 100% hike in prices within just 24 hours.

Dogecoin, which began as a joke in 2013, quickly gathered enthusiastic community support. Before Musk got involved, the logical denomination was fractions of a cent. But thanks to his endorsement and others like him, it became one of the few cryptocurrencies you could use for serious business purposes without being laughed out of town as a speculator or charlatan.

In May 2021, just before his appearance on “Saturday Night Live,” Dogecoin hit an all-time high of nearly $0.73. Even now, despite subsequent price falls due to the crypto winter, Musk's occasional tweets have kept up interest in the first-ever memecoin, showcasing his celebrity influence over the crypto world.

Snoop Dogg and Shiba Inu

Snoop Dogg initially supported Shiba Inu in 2021, collaborating on social media promotions and NFT releases featuring the token's mascot. His backing drastically elevated awareness of SHIB, fueling popularity increases and market activity surges.

Meanwhile, Snoop Dogg's tweets and endorsements have likewise made a distinctive impact on the price and visibility of SHIB. To illustrate, the token’s value bumped when Snoop Dogg tweeted about his Shiba Inu NFT collection. This created SHIB as one of the top memecoins out there, assisting in driving adoption with the general public.

Lionel Messi and his association with crypto

In 2017, football star Lionel Messi had been a central figure within the cryptocurrency space as he was appointed brand ambassador of Sirin Labs. It came with a note to endorse that it had given PSG tokens visibility and value, which was later incorporated into his Socios.com platform.

Messi also joined the high-performing cryptocurrency exchange Bitget in 2022 to help promote education and adoption on a global scale. He also put out a series of NFTs on the platform Ethernity Chain, hinting at how blockchain applications can transcend conventional crypto assets.

Choose coins with practical use cases and not just celebrity hype

There was a time when influencer-marketed coins skyrocketed in value, often due to celebrity endorsements. Being public figures, both the coins have also faced some big blows. Dogecoin, which Elon Musk has mainly boosted, has seen its price multiply or collapse over the years. After 2022, Dogecoin’s price saw a downward trend, and as of 2024, the price stabilized at around $0.082, from its all-time high of $0.7376 (in 2021), after it received support from Elon Musk.

Most of these coins, like Shiba Inu (SHIB), have little substantive underlying technology or exciting use cases and are almost entirely driven by the virality associated with social media buzz, which is likely to be short-lived. However, there is also a significant regulatory risk related to celebrity-endorsed tokens.

Regulators could often interpret these coins as pump-and-dump schemes if they prove successful. In turn, the fickle nature of influencer endorsements only exacerbates this volatility; if influencers like Musk are not prone to consistent support, the market for these coins often needs to be more active.

The above is the detailed content of Influencer Marketing Makes Inroads Into the Crypto Sphere. For more information, please follow other related articles on the PHP Chinese website!