Floki Inu, essentially a cryptocurrency that emerged from internet humor, enjoyed a massive 2400 percent surge to reach a market capitalization of $500 million this week. This incredible ascent followed a tweet from tech mogul Elon Musk, though this is likely no surprise. On October 6, the head of Tesla showcased a snapshot of his Shiba Inu pup named Floki perched within a Tesla. Musk’s casual introduction of Floki had a ripple effect, inflating the prices of similar themed virtual coins over the past day.
Yet, the value of each Floki Inu coin remains less than one cent.
Musk’s social media influence boosts meme coin value
Elon Musk, often jokingly referred to as the Pupper Master, has a history of shaking up the meme cryptocurrency market. His tweets about Dogecoin and Shiba Inu, peppered with internet culture references and humor, have a reputation for sending their values on rollercoaster rides.
Back in September, a mere photograph of his Shiba Inu dog named Floki posted by Musk on Twitter caused the value of crypto assets featuring the breed’s name to rocket, with some seeing a staggering gain of almost 1,000% in mere hours. Even without a direct link to these digital currencies, the tech innovator has a peculiar power to mobilize the masses on social platforms, leading to rapid increases in market interest and investment.
The Floki Inu coin is still worth below a penny.
Benzinga reports that the crypto Floki saw a brief but noteworthy spike on October 3rd, reaching an intra-day high of $0.00007509, per information from Coinbase. Its valuation, however, remains under a cent.
“We’ve indeed made it Floki,” was the jubilant reaction on Twitter. Meanwhile, fellow meme coins Dogecoin and Shiba Inu sailed to a combined worth of over $41 billion.
The sway Musk holds over the digital currency space isn’t universally praised. Many investors are wary of any assets that can be swayed so significantly by a single individual’s remarks, perceiving them as unstable. While there’s potential for spectacular gains, there’s equally a risk of total loss.
In a stern cautionary advisory, the Financial Conduct Authority (FCA) reminded in January, “Investing in cryptoassets, or investments and lending linked to them, usually comes with very high risks for investors’ funds. If consumers sink money into these types of products, they should brace for the possibility of a total loss.”
Unpacking the Meme Coin Craze
Meme coins are digital currencies that are inspired by internet jokes and viral phenomenons. They’ve caught the public eye in recent times, largely due to the backing of influencers like Elon Musk and the buzz generated by individual retail investors on social media. Dogecoin paved the way for meme coins in 2013, its very basis a playful nod to an internet meme. Its surge to notoriety picked up when Musk endorsed it with his tweets, and when the trading community began to back it. From its early days, Dogecoin has been spun into a force for good, funneling funds towards diverse charitable causes.
