A new study conducted by the Network Contagion Research Institute (NCRI) has found that Twitter bots may have a significant influence on inflating the prices of altcoins. The study examined over 3 million tweets surrounding 18 altcoins listed on FTX between January 2019 and January 2023. It discovered that Twitter bot activity played a crucial role in increasing the value of these cryptocurrencies, with half of the coins showing signs of price influence due to bot activity.
The study also revealed that the inauthentic tweets would surge after FTX posted about the token on social media, raising questions about the potential coordination of bot activity by FTX or Alameda Research. The researchers asked whether FTX or Alameda engaged in coordinated inauthentic activity on social media to artificially inflate market values.
Additionally, the study explored the impact of bot activity and Elon Musk’s crypto-related tweets on two memecoins, Pepe (PEPE) and PSYOP. The researchers found that a surge of newly created bot accounts occurred before the launch of PEPE, all of which tweeted about one of the two coins. Furthermore, Musk’s tweets seemingly endorsing each of the tokens contributed to their price increases.
Musk’s tweet of a Pepe meme on May 13 caused the token’s price to surge by over 50% within 24 hours. The study highlighted that account creation surges took place a day before Pepe’s launch, implying a coordinated effort to use bots to amplify the token’s popularity.
The researchers emphasized that this phenomenon of bot-driven manipulation could extend beyond cryptocurrencies and affect stocks and other securities. They referenced the social media frenzy surrounding meme stocks like GameStop and AMC in 2022 as an example.
The findings of this study shed light on the potential manipulation of cryptocurrency prices through Twitter bot activity. It raises concerns about the integrity of market values and calls for further investigation into the role played by social media platforms and market participants in these activities.
In conclusion, Twitter bots have been found to play a significant role in artificially inflating the prices of altcoins, according to the NCRI study. The study also highlighted the influence of bot activity and Elon Musk’s tweets on memecoins, suggesting potential coordinated efforts to manipulate prices. The implications of these findings extend beyond cryptocurrencies and may impact other securities as well. Further research and scrutiny are needed to address the issue of inauthentic social media activity and its impact on market values.
Source link