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While Elon Musk has a history of influencing the stock market, his record in helping to pump the price of digital currencies such as Dogecoin (DOGE) cannot go unnoticed.
David Einhorn has accused Elon Musk, the CEO of Tesla Inc (NASDAQ: TSLA), and venture capitalist Chamath Palihapitiya of adding the real “Jet Fuel” to the fire during the GameStop Corp (NYSE: GME) short squeeze saga involving retail investors and hedge funds earlier this year.
Einhorn, the manager of Greenlight Capital, a New York-based hedge fund with about $1.7 billion in assets under management noted that the media appearances and tweets from both Musk and Chamath helped pump the price of the GameStop shares at a very critical moment.
“We note that the real jet fuel on the GME squeeze came from Chamath Palihapitiya and Elon Musk, whose appearances on TV and Twitter, respectively, at a critical moment further destabilized the situation,” wrote Einhorn, as reported by Markets Insider.
Back on January 26th, Elon Musk reportedly tweeted “Gamestonk!!” referencing a link to the WallStreetBets subreddit credited for fueling the share price run. The tweet stirred GME stock to a new rally of over 134% in the next 24 hours, pushing the price to a new high of $347. Amidst the Reddit fueled rebellion to Wall Street’s short sellers, Einhorn also drew on Chamath’s comments supporting the actions when he appeared in an interview on CNBC as adding fuel to the price surge.
Einhorn and Musk have a history in which the former frowns at the latter’s attempt to manipulate the market through his tweets and actions in general.
“If regulators wanted Elon Musk to stop manipulating stocks, they should have done so with more than a light slap on the wrist when they accused him of manipulating Tesla’s shares in 2018,” wrote Einhorn, “The laws don’t apply to him and he can do whatever he wants.”
Einhorn submitted that “quasi-anarchy” now reigns, per the unbridled regulation of the stock market.
Elon Musk’s Jet Fuel Is More Functional in the Crypto Space
While Elon Musk has a history of influencing the stock market, particularly his company’s shares, his record in helping to pump the price of digital currencies such as Dogecoin (DOGE) cannot go unnoticed.
Musk has often voiced his likeness for dogs and memes which informs his interest in Dogecoin, the cryptocurrency that was created in 2013 as a joke with the Shiba Inu dog breed serving as its theme. Elon Musk also updated his Twitter bio back on January 29th to feature Bitcoin (BTC). The premier digital currency surged by 14% from $32,000 to $37,800 following this action.
Musk’s occasional tweets about Dogecoin in particular always result in a pump and dump rally, a situation that legal professionals warn may attract a probe from the United States Securities and Exchange Commission (SEC). However, the Tesla boss has downplayed the threats saying his tweets are only informed by his likeness for the cryptocurrency, and not as a means to manipulate.