Shalini Nagarajan

Social media platforms are quite powerful tools for predicting crypto prices, according to a recent study by finance professors and a PhD student at Pennsylvania State University. 



They found sentiment on social media significantly influences short-term crypto returns. Sentiment from the news media, however, barely moved the needle.



“The results … strongly support the hypothesis that sentiment extracted from social media predicts cryptocurrency returns, while sentiment derived from news media does not.”



Reflections laid out in the <a href="https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4495683" target="_blank" rel="noreferrer noopener">paper</a>, titled “An Anatomy of Cryptocurrency Sentiment,” show smaller cryptocurrencies — which don&#8217;t get as much media attention — are more influenced by the overall sentiment of the market, as filtered by social media.



“&#8230; We observe that both crypto specific and market-wide sentiments matter, but the predictive power of the latter is economically and statistically stronger,” they said.



“This finding may be counter-intuitive as it would be natural to expect that only sentiment tied to fundamental events would have predictive power, but it turns out that in the cryptocurrency market, sentiment, even when decoupled from fundamental events, does matter for returns.”



The study included 267 cryptocurrencies, excluding stablecoins, covering the period between Jan. 1, 2018 to April 4, 2021. Market caps for all tokens were under $1 million.



<h2 class="wp-block-heading">Emotions influence crypto prices</h2>



Anecdotal evidence cited for social media’s potential impact on crypto prices included Dogecoin’s 10,000% rally after a string of supportive tweets from Elon Musk and other celebrities in 2021.&nbsp;



Another incident was FTX&#8217;s token, FTT, <a href="https://blockworks.co/news/binance-is-buying-ftx-a-timeline-of-events" target="_blank" rel="noreferrer noopener">collapsing 70% in one day</a> after Binance CEO Changpeng Zhao tweeted that Binance would liquidate its holdings. FTX would declare bankruptcy only two weeks later.



In showing more scientific proof that social media sentiment was linked to crypto prices, the researchers noticed a trend: positive events like code updates, crypto adoption and innovation generally boost sentiment, while negative events like regulatory crackdowns or scams tend to dampen it.



Both social and news media generally expressed positive attitudes toward cryptocurrencies throughout the duration of the study, researchers said. The team used sentiment data from Refinitiv MarketPsych Analytics. 



Per the paper, social media discussions have a significant impact on shaping sentiment, with emotions influencing how people perceive cryptocurrency value, and thus, actual returns.



Unlike discussions and posts on social media, journalistic articles tend to provide more factual information and may appear less emotionally charged, they found.



Researchers wrote: “&#8230; While events that may be considered &#8216;fundamental&#8217; to cryptocurrency value, such as news on transaction speeds, code upgrades, anonymity, currency adoption, and technological innovations, impact market sentiment, they do not fully explain it.”



“Importantly, we observed that it is the unexplained sentiment, which we refer to as ‘exuberance,’ that consistently and significantly predicts cryptocurrency returns.”



Read more: <a href="https://blockworks.co/news/crypto-doesnt-care-about-fundamentals-is-that-sustainable" target="_blank" rel="noreferrer noopener">‘Crypto Doesn’t Care About Fundamentals.’ Is That Sustainable?</a>



<h2 class="wp-block-heading">‘Momentum’ strategy pays off when sentiment is high</h2>



The team studied daily returns of a long-short crypto portfolio with a holding horizon of one week.&nbsp;&nbsp;



By comparing data during periods of both positive and negative sentiment, it was possible to calculate the profitability of short-term “momentum” strategies based on social media chatter and the like. 



The momentum strategy effectively boiled down to quantifying market sentiment for individual cryptocurrencies and “longing the winners, shorting the losers.”



The researchers found that the momentum strategy wasn’t significantly profitable on average — but it was when market exuberance was high. And when market sentiment was low, the strategy wasn’t really effective.



Overall, increased crypto prices (or “perceived cryptocurrency value”) were associated with increased market exuberance.



“We conclude that market exuberance affects price perception and/or investors’ demand, thereby contributing to explaining momentum returns in the cryptocurrency space,” the researchers said.



“This finding suggests that market participants might be reacting to a general mood of optimism or pessimism, reflected in market exuberance, rather than reacting to any tangible changes in the fundamentals.”



Yale University academics recently <a href="https://blockworks.co/news/crypto-twitter-bots-returns" target="_blank" rel="noreferrer noopener">conducted a separate study</a> examining the influence of social media on crypto returns. Their research uncovered that crypto projects with a greater volume of posts from Twitter bots tended to have lower long-term returns.



David Canellis contributed reporting.



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Crypto prices predicted by social media sentiment more than headlines: Study

David Canellis

If you squint and turn your head a bit, crypto looks something like a protest movement.



<ul>
<li>Sick of banks exploiting your deposits for their own gain? Buy bitcoin.</li>



<li>Tired of overt financial surveillance? Buy monero.</li>



<li>Rather gamble on Binance than casino blackjack? Buy shiba inu.</li>
</ul>



Outside of passive-aggressive speculation crypto fans have few ways of effective protest, especially against this cycle’s No. 1 villain, SEC chair Gary Gensler.



Bagholder marches aren’t really a thing (yet). So, a Manhattan rally for those who bought the top on the SEC’s “<a href="https://blockworks.co/news/securities-bnb-sec-suits" target="_blank" rel="noreferrer noopener">crypto securities</a>” is out of the question.



Publicity stunts are also absent. Climate protestors throw <a href="https://www.theguardian.com/environment/2022/oct/14/just-stop-oil-activists-throw-soup-at-van-goghs-sunflowers" target="_blank" rel="noreferrer noopener">soup</a> on Van Goghs and <a href="https://www.pbs.org/newshour/arts/climate-activists-try-to-glue-themselves-to-famed-painting-the-scream" target="_blank" rel="noreferrer noopener">glue</a> themselves to The Scream, but you won’t catch a <a href="https://blockworks.co/price/matic" target="_blank" rel="noreferrer noopener">MATIC</a> maxi chaining his ankles to the Wall Street Bulls’ balls lest the SEC back off.



What about a protest vote? Favorable securities laws are the single issue that determines your vote in the next election. All sorts of moral hazards and miseries ensue, by way of grubby political pandering.



Throw money at PACs and <a href="https://blockworks.co/news/the-gop-also-got-millions-from-ftx-execs" target="_blank" rel="noreferrer noopener">Super PACs</a> working in mysterious ways to install crypto-friendly politicians, sure, but that can be expensive — and you won&#8217;t even get a volatile cryptocurrency in return. 



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">I encourage all investors to educate themselves on how you conspired with the greatest scammer of our generation to give him a regulatory loophole <a href="https://t.co/XV25FBeLVm">pic.twitter.com/XV25FBeLVm</a>&mdash; Evan Van Ness (@evan_van_ness) <a href="https://twitter.com/evan_van_ness/status/1669740715050409989?ref_src=twsrc%5Etfw">June 16, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div><figcaption class="wp-element-caption">Ahhh I’m ratioinggggg</figcaption></figure>



Ratioing Gensler on Twitter is really all there is. It started out as a light ribbing. A few hundred more comments to likes — mostly in response to Robinhood’s payment-for-order-flow <a href="https://www.cnbc.com/2021/02/18/payment-for-order-flow-the-controversial-wall-street-practice-to-draw-scrutiny-at-robinhood-hearing.html" target="_blank" rel="noreferrer noopener">controversy</a> amid GameStop mania. 



XRP army rumblings, even, about <a href="https://blockworks.co/news/inside-ripple-defense-strategy" target="_blank" rel="noreferrer noopener">the Ripple case</a> and the <a href="https://blockworks.co/news/sec-hinman-eth-not-security" target="_blank" rel="noreferrer noopener">much-anticipated-and-now-released</a> Hinman documents.



In between, there were plenty of posts with more healthy ratios. His first post directly addressing crypto, in September 2021, was warmly received, in fact, scoring a 1:2 ratio (comments to likes).



<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="1184" height="992" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=1024&amp;h=1024" alt="" class="wp-image-60639" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=1184 1184w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=307 307w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=312 312w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=261 261w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-04-at-13.46.04.png?w=80 80w" sizes="(max-width: 1184px) 100vw, 1184px" /><figcaption class="wp-element-caption">Simpler times, when there was still hope</figcaption></figure>



All that had worn off about a year later, as the SEC ramped up its prosecution of major US players, <a href="https://blockworks.co/news/sec-sues-coinbase" target="_blank" rel="noreferrer noopener">namely Coinbase</a>. It’s only getting worse. 



These days, Gensler can’t post ELI5s about compound interest without being mercilessly trolled, with one such <a href="https://twitter.com/GaryGensler/status/1673707772712566784">tweet</a> facing a 5:1 ratio last week. 



Replies include: “Everyone would rather like to know ‘What is a security?” and “Can you please do a post on what a bad faith actor is?” as well as “I have a ‘compounding interest’ in the<a href="https://twitter.com/hashtag/FireGaryGensler?src=hashtag_click" target="_blank" rel="noreferrer noopener"> #FireGaryGensler</a> movement!”



<figure class="wp-block-image"><img decoding="async" src="https://lh4.googleusercontent.com/BBUN2Lpj4EwcS4BUMOysvw9TUuTOYRARbIC3GKQx7k2_yQhdNcbYRPLtvZ7eN5U17B8gSopT7cw48vx_is2YRGtNBHa_h92DcyMJE7Fu4heYhT9vaMOzt41ioLHjRxifdo4B5_YlZKNcLa7ItPEIzp0" alt=""/><figcaption class="wp-element-caption">Gensler ratios deteriorated after the Coinbase Lend Wells notice</figcaption></figure>



A recent <a href="https://twitter.com/GaryGensler/status/1667214976963039232" target="_blank" rel="noreferrer noopener">post</a> advising college students on summer holidays to consider the best ways to save money was hammered at more than 8:1. “Best advice for college grads: don’t take advice from Gary.” “Is this financial advice from Gary Gensler himself? SEC should sue him for this.” “Who bullied you at school?”



Certainly there have been <a href="https://www.nytimes.com/2002/11/06/business/sec-s-embattled-chief-resigns-in-wake-of-latest-political-storm.html" target="_blank" rel="noreferrer noopener">instances</a> in <a href="https://www.sechistorical.org/museum/galleries/rev/rev02a.php" target="_blank" rel="noreferrer noopener">history</a> where the SEC chair has been forced to resign for mild-to-medium corruption. Even fraud. Legitimate accusations against Gensler are however non-existent, more meme than reality.



(Blockworks opinion editor Molly Jane Zuckerman previously outlawed any more opinion pieces about Gensler. Luckily, she&#8217;s not here today.)



Read more: <a href="https://blockworks.co/news/gary-gensler-is-utterly-unimportant" target="_blank" rel="noreferrer noopener">Gary Gensler is utterly unimportant</a>



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Garrryyyy! What&#39;s good! Yo, still waiting to hear back from you about ALGO? Just need to know if you&#39;re still bullish on them? I mean you said that they could create Uber on top of It! You think that&#39;s still gonna happen or what?! Look forward to your thoughts G-Man! Much love ❤️&mdash; batz (@batzdu) <a href="https://twitter.com/batzdu/status/1667229733082243081?ref_src=twsrc%5Etfw">June 9, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div><figcaption class="wp-element-caption">Another tweet just said “ratio.”</figcaption></figure>



Fantastical headlines still fuel frothy expectations through less discerning audiences that Gensler may well be moved on from his post.&nbsp;



A rumor that Gensler was ready to resign, fanned by an AI-generated blog last week, quickly triggered an SEC denial through a Fox News <a href="https://twitter.com/CGasparino/status/1675650578657992704" target="_blank" rel="noreferrer noopener">reporter</a>.



Industry lobby groups are lending legitimacy to the rabble-rousers, after two House Republicans <a href="https://blockworks.co/news/republicans-oust-gensler-bill" target="_blank" rel="noreferrer noopener">cleared a warpath</a>. The Blockchain Association (BA) in a fiery statement last week demanded Gensler recuse himself from all matters digital asset, on account of his opinion that bitcoin is the only kosher crypto clouds his judgment.



<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="1188" height="1246" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=1024&amp;h=1024" alt="" class="wp-image-60638" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=1188 1188w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=286 286w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=976 976w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=245 245w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=249 249w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=209 209w, https://blockworks-co.imgix.net/wp-content/uploads/2023/07/Screen-Shot-2023-07-03-at-20.01.08.png?w=76 76w" sizes="(max-width: 1188px) 100vw, 1188px" /><figcaption class="wp-element-caption">The associated tweet from BA lawyer Jake Chervinsky boasted a dynamic 1:17 ratio</figcaption></figure>



Will Gensler, a Biden appointee, resign, embarrassed by non-stop boos of the digital swamp we call Crypto Twitter?&nbsp;



Probably not. Even if Donald Trump wins. The former President <a href="https://www.nbcnews.com/tech/tech-news/trump-says-he-s-not-fan-cryptocurrencies-n1029116" target="_blank" rel="noreferrer noopener">hates crypto</a> (and loves the US dollar), why would he install a sympathizer? 



Still, with no other recourse, ratioing Gensler on Twitter is all crypto has right now.



<hr class="wp-block-separator has-alpha-channel-opacity"/>


<div class="wp-block-post-author-biography">David is an Editor based in The Netherlands focused on data-driven journalism. Previously, he wrote for TheNextWeb&#8217;s crypto vertical before launching Protos in 2021. He&#8217;s a reformed hardline Bitcoiner passionate about permissionless and decentralized networks. Contact David at david@blockworks.co</div>


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Ratioing Gensler on Twitter is sadly crypto’s most powerful protest

Crypto projects with more posts from Twitter bots tend to have lower returns over the long-term, according to a study from two Yale University academics.



The researchers examined more than one million tweets about 48 different cryptocurrencies created between 2019 and 2021. All had a fundraising goal of more than $1 million via token sales.



Their study focused on projects including axie infinity (<a href="https://blockworks.co/price/axs" target="_blank" rel="noreferrer noopener">AXS</a>), cowswap (<a href="https://blockworks.co/price/cow">COW</a>) and polygon (<a href="https://blockworks.co/price/matic">MATIC</a>) leaving out bitcoin (<a href="https://blockworks.co/price/btc">BTC</a>) and ether (<a href="https://blockworks.co/price/eth">ETH</a>). All had a fundraising goal of more than $1 million via token sales.



A system to measure a so-called &#8220;engagement coefficient&#8221; quantified the level of interest and interaction displayed by social media users.



“Low engagement coefficients signal a lack of interest, while high engagement coefficients signal artificial activity which is likely from automated accounts known as bots,” Prof. Tauhid Zaman and PhD student Khizar Qureshi wrote in the <a href="https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0284501#references" target="_blank" rel="noreferrer noopener">paper</a>.



“We found that the [engagement coefficient] was correlated with the future returns of the cryptocurrencies, and was most predictive of short-term returns.”



If a cryptocurrency has a very low engagement coefficient, it means that people aren&#8217;t really interacting with posts about it. This shows a lack of interest, which usually results in low returns over a long time horizon, the study said.



To predict future performance, the researchers devised an investment strategy that weighted portfolios based on bot activity and engagement coefficient. The latter appears to have a bigger influence, they found, especially over the first month of a token’s life.



The researchers noted that people can create a bunch of bots and make them engage with posts about a cryptocurrency to make it seem like there&#8217;s a lot of hype around it. This is what usually happens in pump-and-dump schemes, they said.



&#8220;These findings suggest that long-term returns are less dependent on social media features than short-term returns.&#8221;



<h2 class="wp-block-heading">Tracking viral crypto bots to trade better</h2>



As part of the analysis, the team looked at social media posts from the first month of each crypto’s existence.&nbsp;



Out of its chosen tokens, the researchers identified krypto as the cryptocurrency with the most buzz, a token used for in-game purchases in NFT battle game Kryptobellion.&nbsp;



At first, krypto had good returns, hitting as high as 49% after two months. But then things went downhill, and its returns turned negative. &#8220;This is likely due to bots programmed to like and retweet any tweets about krypto,&#8221; they said.



After 12 months, some cryptocurrencies had returns of over 2,000%, and the top dog was Axie Infinity’s AXS with returns of more than 24,500%.&nbsp;



“Overall, our results show that one can use social media activity to predict the future performance of cryptocurrencies over longer time horizons than previously known (months versus hours or days),” the researchers said.



<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="1490" height="936" src="https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=1024&amp;h=1024" alt="crypto twitter bot study returns" class="wp-image-59636" srcset="https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=1490 1490w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=300 300w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=1024 1024w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=768 768w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=409 409w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=415 415w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=349 349w, https://blockworks-co.imgix.net/wp-content/uploads/2023/06/Screen-Shot-2023-06-22-at-13.02.10.png?w=80 80w" sizes="(max-width: 1490px) 100vw, 1490px" /><figcaption class="wp-element-caption">AXS sat around the middle of the pack in terms of engagement coefficient.</figcaption></figure>



They continued: “If it is truly the case that virality significantly drops after one month, investors can begin to exit their speculative positions, and potentially avoid the infamous ‘pump and dump.’ As their chosen cryptocurrency begins to lose engagement, their expected returns should be revised downward, which in turn should influence their investment decisions.”



Traders could even estimate engagement coefficients themselves using daily social media feeds for various cryptocurrencies to make short-term bets on the most “viral” tokens, the researchers posited.



There were concerns that the data could be skewed somewhat, considering some of the analysis covered a bull market when traders were more &#8220;risk-loving.&#8221; Still, the authors believe their social media engagement model is flexible, so it can work in all sorts of situations.



In the future, researchers could check if the model can predict other stuff like how well movies and TV shows do, sales of fashion items, who wins in political campaigns or even how cryptocurrencies with bigger market caps perform.



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Crypto returns are worse if Twitter bots drive engagement: Study

Blockchain data provider DeFi Llama has walked back claims about an internal conflict that led to the split of its website and Twitter handle.



0xngmi, a member of the project said to be responsible for 90% of DeFi Llama’s success, initially claimed on Twitter that the team was undergoing a “hostile takeover” as another member wanted to launch a token. Apparently, this was a move the rest of the team didn’t approve of.



But late on Monday, 0xngmi provided an update to say the <a href="https://twitter.com/0xngmi/status/1637425043482222599" target="_blank" rel="noreferrer noopener">argument</a> had been resolved, the fork had been canceled, and the website would continue to work on a single <a href="http://defillama.com/" target="_blank" rel="noreferrer noopener">domain</a>.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">For everybody who is asking: everything has been solved and all work will continue on <a href="https://t.co/8b11M6Yk9u">https://t.co/8b11M6Yk9u</a>, <a href="https://t.co/G0h4uBo2mL">https://t.co/G0h4uBo2mL</a> will just be redirecting there&mdash; 0xngmi (llamazip arc) (@0xngmi) <a href="https://twitter.com/0xngmi/status/1637955928887533570?ref_src=twsrc%5Etfw">March 20, 2023</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



DeFi Llama <a href="https://twitter.com/DefiLlama/status/1637910941550489605" target="_blank" rel="noreferrer noopener">confirmed</a> the development via Twitter, apologizing for “poor communication” and “misunderstanding within the team.” 



“We would like to put what happened behind us. There is no LLAMA token currently planned, and any airdrop will be discussed with the community, as every important decision is,” the project said.



“We will take steps to operate in a more transparent manner to ensure this doesn&#8217;t happen again.” It added that each arm of LlamaCorp would cooperate with the other.



The team caused quite a stir over the weekend after 0xngmi and another individual contributor Tendeeno openly indicated on Twitter that DeFi Llama’s co-founder 0xLLam4 didn’t care about the opinions of the rest of the team.



Tendeeno had said DeFi Llama was the most successful project under the LlamaCorp umbrella, which includes other services like DL News and LlamaPay. Developments surrounding the conflict have not affected DL News, and it continues to be business as usual at the new outlet, according to a person familiar with the matter.&nbsp;



However, DeFi Llama itself was not generating revenue, which is why the co-founder thought launching a token would solve this.&nbsp;



Tendeeno said the team didn’t want this because “the project’s value and reputation would be wrapped up in this token.” He further claimed that the co-founder behind the hostile takeover had not contributed any work to DeFi Llama and had not paid employee salaries.&nbsp;



DeFi Llama did not comment on the claims laid out in Tendeeno’s tweets.



Tendeeno added to the narrative late Monday, saying the team wants to move on without continuing the conversation publicly, “but rest assured everyone at DL is happy with the outcome.”



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DeFi Llama Quells Internal Squabbles, Scraps Token Launch Plans

Sebastian Sinclair

<div id="highlights-block_62676e04e4580" class="highlights">
 <ul>
 <li>SpaceX and Tesla CEO Elon Musk has reached a deal with Twitter&#8217;s board of directors to buy the platform</li>
 <li>The $44 billion deal is expected to close sometime this year, subject to the approval of Twitter&#8217;s shareholders</li>
 </ul>
 
</div>



Major social media platform Twitter said Monday it had entered into a definitive agreement to be acquired by an entity wholly owned by Elon Musk in a deal worth $44 billion.



Under the terms of the deal, Twitter shareholders are to receive&nbsp;$54.20 per share in cash for each share of Twitter common stock that they own, according to a <a href="https://www.prnewswire.com/news-releases/elon-musk-to-acquire-twitter-301532245.html" target="_blank" rel="noreferrer noopener">press release</a>.



The deal has been unanimously approved by Twitter&#8217;s Board of Directors and is expected to close sometime this year, subject to the approval of the platform&#8217;s stockholders.



Upon the deal&#8217;s completion, Twitter is expected to transition to a privately held company, ending its nine-year run as a publicly listed company on the New York Stock Exchange.



The buyout represents a 38% premium to Twitter&#8217;s closing stock price on April 1 — the final day Musk unveiled his 9% stake in the social media company.



Musk has secured&nbsp;$25.5 billion&nbsp;of fully committed debt and margin loan financing while providing an approximately&nbsp;$21.0 billion&nbsp;equity commitment, per the release.



A major platform for the crypto community, Twitter is often both been praised and reviled for its approach to content moderation, freedom of speech (or lack thereof) and user profile anonymity. 



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">I hope that even my worst critics remain on Twitter, because that is what free speech means&mdash; Elon Musk (@elonmusk) <a href="https://twitter.com/elonmusk/status/1518623997054918657?ref_src=twsrc%5Etfw">April 25, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Musk — who is estimated to be worth upwards of $268 billion, according to <a href="https://www.forbes.com/profile/elon-musk/?sh=7f05142c7999" target="_blank" rel="noreferrer noopener">Forbes</a> — said he wanted to improve Twitter through the introduction of new features, provide an open-source algorithm for the platform and tackle its spambots.



&#8220;Free speech is the bedrock of a functioning democracy and Twitter is the digital town square where matters vital to the future of humanity are debated,&#8221; Musk said in the release.



There are also reportedly plans to turn the platform into a <a href="https://www.reuters.com/technology/exclusive-twitter-set-accept-musks-best-final-offer-sources-2022-04-25/" target="_blank" rel="noreferrer noopener">subscription-based model</a> to bolster revenue and recoup some of Musk&#8217;s initial investment, according to Reuters&#8217; reporting.



Whether that would appease the crypto community or drive users to seek alternatives remains to be seen. Musk, whose Twitter musings about crypto — <a href="https://twitter.com/elonmusk/status/1113009339743100929?s=20&amp;t=jrmg8dS0He5IpDA6OAx-UA" target="_blank" rel="noreferrer noopener">particularly Dogecoin</a> — have resulted in the wild oscillation in prices, is often viewed as both an inflammatory and influential figure within the community.



In January, Dogecoin payments on electric car company Tesla’s online shop <a href="https://cms.blockworks.co/tesla-launches-dogecoin-payments-in-online-shop-price-jumps-17/" target="_blank" rel="noreferrer noopener">went live</a>&nbsp;for select items. At the time, the price of Doge shot up more than 17% within a 24-hour period.



Following a purchase of $1.5 billion worth of bitcoin last year in March, Musk announced via Twitter that Tesla would be accepting bitcoin as payment for vehicles before reneging two months later, citing environmental concerns.



On both occasions, bitcoin&#8217;s price movements coincided closely with Musk&#8217;s announcements, gaining 48% and then subsequently shedding 40% two months later.



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