Dog Coins Take Turns in the Spotlight: Is the "Musk Effect" Still Relevant?
KISHU -8.93%
Recently, meme tokens represented by dog-themed series such as SHIB and KISHU have staged consecutive rallies, reigniting enthusiasm for "animal coins" and garnering widespread attention from media and the investment community. According to OKX market data, on October 26, the dog-themed token KISHU saw sustained price increases, with a single-day gain of 79.38%. From October 24 to October 26, the Shiba Inu coin SHIB token rose consecutively by 64.38%, reaching $0.00004966. Regarding this market movement, on one hand, many investors expressed confusion; on the other hand, some believe that the surge in these animal coins may be related to Musk's recent statements.
Just days ago, as Bitcoin prices hit record highs, Musk—who had reclaimed his position as the world's richest person—once again discussed the crypto market on Twitter after several months of silence, sparking considerable discussion. In the intervening months, the crypto market has undergone "tremendous changes." Following the "negative impact" Musk had on the crypto market during the previous May 19 crash, can the once wildly popular "Musk effect" still work? What is the current impact of Musk and Tesla on the Bitcoin market? Can the crypto market ignite a new bull run because of Musk's "return"? In this article, we will discuss these questions in more detail and examine how the digital assets Musk "endorsed" have performed.
Tesla—The "Giant" Behind Bitcoin
On October 21 Beijing time, Tesla released its latest earnings report, showing Q3 revenue of $13.76 billion, up 57% year-over-year, with operating profit of $2 billion, up 148% year-over-year. According to its third-quarter returns report, the company reported no new digital asset sales or purchases. As of the end of the quarter (September 30), Tesla's "digital assets" had a book value of $1.26 billion, with a $51 million impairment in Q3, while the fair market value of its digital assets holdings was $1.83 billion.
In Q1 this year, Tesla announced the purchase of $1.5 billion in Bitcoin, with an estimated cost per coin around $30,000, and obtained $272 million in cash returns through selling 10% in Q2. To date, according to buybitcoinworld.com data, Tesla still holds approximately 40,000+ Bitcoin. With Bitcoin recently breaking through to a high of $66,999, Tesla's investment returns have already doubled. Tesla is currently the second-largest publicly traded company in terms of Bitcoin holdings and value, second only to Microstrategy. If the crypto bull market continues, the returns on Tesla's Bitcoin position will become even more substantial.
On one hand, due to Tesla's massive Bitcoin holdings, and on the other hand, with the influence of Tesla CEO Elon Musk, it can be seen that Tesla now holds a "pivotal" position in the crypto market. Combining Tesla's major Bitcoin-related developments in the first half of this year, it can be observed that Bitcoin prices have been significantly affected.
On March 24, 2021, Musk announced that Tesla's US website had begun supporting Bitcoin payments. Stimulated by this news, Bitcoin rose $1,000 in the short term. Then on May 13, Musk suddenly announced on Twitter that Tesla would stop supporting Bitcoin for car purchases. Similarly affected by this news, Bitcoin prices rapidly declined that day, dropping over $10,000 in the short term, with a 24-hour decline of nearly 15.29%.
Later, Musk stated that Tesla would resume Bitcoin payments if "at least half" of the Bitcoin network's computing power was provided by renewable energy. In quarterly filings submitted to the US Securities and Trading Commission (SEC) this September, Tesla indicated it "may restart cryptocurrency trading practices in the future," meaning Tesla will re-support Bitcoin payments in the future. At that time, what kind of waves will this create in the market, and can Tesla's behind-the-scenes "catalyst" role be replicated? We can wait and see.
Currently, as of the latest data on October 26, Tesla's stock price has broken through $1,000, with a market cap reaching and exceeding $1 trillion, approaching Bitcoin's market cap. To verify Tesla's position in the crypto market, we must mention this person who once captured investors' attention—Musk. The Musk who once "called the shots" and sent Dogecoin to the moon, can he now once again drive market sentiment and create new wealth codes?
Is the "Musk Effect" Still Working?
With the sharp rise in stock price and Tesla's total market value increasing, Musk has once again firmly secured his position as the world's richest person with a net worth of approximately $270 billion, becoming the richest person ever recorded by Forbes magazine. According to the Bloomberg Billionaires Index, Musk's personal assets currently equal the combined assets of Gates and Buffett.
Musk's influence in the crypto market primarily comes from his discussions about crypto market dynamics on Twitter. Looking back, reviewing this year's major market fluctuations, it is not difficult to find that after each of Musk's important statements, crypto market prices have experienced significant volatility. As mentioned earlier, we cited two typical examples of Tesla supporting and canceling Bitcoin payments. Additionally, Musk can be described as the steadfast "spokesperson" for Dogecoin; most of his Twitter activity related to the crypto market involves discussing and promoting Dogecoin, which directly contributed to Dogecoin becoming one of the top ten digital assets by market cap globally this year.
In Q2 this year, Dogecoin's surge also popularized the animal coin concept, with a series of "animal coins" taking turns in dramatic rallies. The impact of Musk's Twitter activity on crypto market-related coin prices was jokingly referred to by investors as the "Musk effect."
Now, many dog-themed tokens have once again seen dramatic rallies, seemingly returning to the familiar "zoo market" before the "May 19 crash." According to OKX market data, SHIB rose 64.38% over three consecutive days, KISHU surged 79.38% in a single day on October 26, and as of this writing, AKITA's daily gain has reached 48.23%. Even a meme token named "ELON" has risen nearly 30% today.
This situation inevitably leads many investors to think of Musk again: "What did Musk say?", "Does what Musk says still work?"
Indeed, Musk has recently begun frequently discussing the crypto market on Twitter again after several months. On October 21, after Bitcoin hit a new all-time high of $66,999, Musk posted a suggestive image on Twitter showing Bitcoin and Ethereum price information, to which many Twitter users cheered: "Elon Musk is back!" On October 25, Musk tweeted about Dogecoin: "It's important to lower fees, reduce block times, and increase block size. A single Layer 1 network, paired with exchanges serving as Layer 2, seems like the simplest solution as a trading medium." Subsequently, when replying to user questions, Musk agreed that Dogecoin could potentially be more efficient than the Lightning Network if it achieved these goals. Additionally, when asked by a user how much Shiba Inu coin he held, Musk responded that he did not hold any.
From the market reaction, SHIB—which Musk does not hold—has recently surged dramatically, while Dogecoin has fallen instead of rising. Does this indicate that the "Musk effect" is gradually losing its effectiveness?
Actually, the current market several months later is somewhat different from the situation before the "May 19 crash." When the "Musk effect" was previously sought after, it coincided with new investors continuously entering the market, bringing in a constant influx of hot money, with FOMO sentiment largely amplifying and magnifying the impact of Musk's statements. Now, as the world's richest person and the head of Tesla holding massive amounts of Bitcoin, Musk's influence certainly remains. However, after multiple deep declines and corrections, many new investors who entered the market this year have "left in disgrace," with some even being "greatly disappointed" by the negative impact of Musk's previous statements. If there is no large influx of new funds at present, will the market still pay for the "Musk effect"? We will not draw conclusions for now, leaving it to our readers to verify.
Disclaimer
This article may contain content about products not available in your region. This article is dedicated to providing general information only and is not responsible for any factual errors or omissions. This article represents only the author's personal views and does not represent OKX's views. This article is not intended to provide any of the following advice, including but not limited to: (i) investment advice or investment recommendations; (ii) offers or solicitations to buy, sell, or hold digital assets; or (iii) financial, accounting, legal, or tax advice. Holding digital assets (including stablecoins) involves high risk, may fluctuate significantly, or even become worthless. You should carefully consider whether trading or holding digital assets is suitable for you based on your financial situation. For questions about your specific situation, please consult your legal/tax/investment professionals. Information appearing in this article (including market data and statistics, if any) is for general reference only. Although we have exercised all reasonable care in preparing this data and these charts, we assume no responsibility for any factual errors or omissions expressed herein. © 2025 OKX. This article may be reproduced or distributed in its entirety, and excerpts of 100 words or less may also be used, provided such use is non-commercial. Any reproduction or distribution of the entire article must also prominently state: "This article is copyrighted © 2025 OKX, used with permission." Permitted excerpts must cite the article title and include attribution, such as "Article Title, [Author Name (if applicable)], © 2025 OKX." Some content may be generated or assisted by artificial intelligence (AI) tools. No derivative works or other uses of this article are permitted.
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