How TikTok Cryptocurrency Influencers Are Educating a New Era of Buyers
On March 22, 2020, a day before the UK announced its first lockdown for Covid-19, Joel Davies joined TikTok, delighted with the buzz that is surrounding it. He wasn’t aware that this would lead him to life changing money. Davies, 23, had been interested in cryptocurrency since he was 16, but aside from a small investment in Bitcoin, curiosity lagged when he graduated from Bath Spa University with a degree in film, television and digital production. After graduating in 2019, Davies moved back to his parents’ house in South Wales, collecting savings from his marketing job and logging into a Discord server that evening, a communications platform he discovered through Dennis Liu, 26, a leading crypto had influencer on TikTok, which is also called VirtualBacon.
“When I found VirtualBacon on TikTok, it encouraged me to invest and learn more [cryptocurrency]Says Davies. Liu’s down-to-earth style and focus on research and analysis stood out for Davies in what he considered to be rich in shillings, scams, and hyperbolic price targets. Davies learned this through VirtualBacon’s Discord community and TikTok videos Fundamentals of investing in crypto, including trading on centralized exchanges and creating a digital wallet, plus advanced skills like analyzing tokenomics and evaluating the fundamentals of a business. He made his first crypto investment in a month in the UK lockdown one year Davies converted its initial investment of £ 2,500 to nearly £ 100,000 (about $ 3,548 to nearly $ 141,930).
Perhaps no other market is more susceptible to the influence of social media than cryptocurrency, where, for example, a single tweet from Elon Musk can pump Dogecoin, a meme currency, to all-time highs or drive Bitcoin soaring. A TikTok user joked a coin called SCAM (“Simple Cool Automatic Money”) that hit a market cap of $ 70 million an hour after it was released. The market capitalization is currently around $ 850,000.
Newer, self-directed investors are more likely to put their money in riskier assets like cryptocurrency, partly due to thrills, novelty, and social stamps. This is the result of a study commissioned by the UK’s Financial Conduct Authority. Much of the buzz about cryptocurrency can be attributed to influencers and social media hype, according to the study. An informal group of crypto enthusiasts recently joined TikTok because it has the greatest potential for expanding their audience, says Liu. According to an April survey by the Pew Research Center that found 48 percent of adults under 30 use TikTok, audiences say they use TikTok, compared with just 22 percent of 30-49 year olds. Scams – like meme economies According to some influencers on the platform, online memes like financial goods and vice versa, as well as pump-and-dump systems, are widespread.
Newer, self-directed investors are more likely to invest their money in riskier assets like cryptocurrency due to the thrill, novelty, and social label, among other things.
“When I started doing crypto [videos] Nobody did it on TikTok, ”says Liu. Liu’s first foray into the crypto industry was mining Dogecoin – using computers to solve complex math problems to get new coins into circulation – from his dormitory at McGill University in 2014. In 2017, he had extra money that he wanted to invest, and crypto was what he knew best. “It’s a riskier playing field, but in a weird way it’s fairer to someone who’s new – a younger audience,” he says. Liu’s most popular TikTok videos are timely analysis of key price shifts in Bitcoin and Ether, especially when they are falling, and other highly traded crypto assets. “The people at TikTok are often very new investors, so these types of videos do well,” he says. “It’s not just an analysis, but a bit of reassurance to put your mind at ease on the volatile crypto market.” In his videos, his straightforward transmission via a green screen showing a coin card or other information is a popular format for Crypto TikTok today.
CryptoWendyO, the TikTok username of a person who claims to be a woman in their thirties and has refused to give their real name. She has experienced online harassment. Four to eight TikTok videos are created per day in which the price movement of Bitcoin is analyzed and questions are answered in the comments or in the summary of the three most important daily news in crypto. Their most watched video has over 500,000 views and describes a simple investment strategy known as a “moon pocket”. “The moon-bag strategy is where you take your initial investment out once you’ve made a profit and then take your initial investment and convert it to another project,” she says. “Rinse and repeat.”
[VirtualBacon’s] The uncomplicated delivery via a green screen on which the card of a coin or other information is displayed is a popular format for Crypto TikTok today.
CryptoWendyO says she didn’t take TikTok seriously at first, but was convinced after Ben Armstrong, who with BitBoy Crypto is one of the most popular crypto accounts with over 2.6 million TikTok followers, encouraged her to join. “TikTok is a great platform to get a large amount of information in a very short time,” says CryptoWendyO. “I can do a lot more with a TikTok video than with a Twitter
[thread]and more people will see the TikTok. ”
Lucas Dimos, 20, known as TheBlockchainBoy on TikTok, says he first heard about Bitcoin from his mother in 2017. He later founded his own blockchain company, CryptoKnight, to develop an algorithmic trading bot, and now operates a Discord server of the same name. Dimos joined TikTok on January 27, 2021 in the heat of the GameStop Short Squeeze. Since then, it has gained more than 210,000 followers.
A study by Paxful, a cryptocurrency trading platform, analyzed more than 1,200 videos of TikTok financial influencers and found that every seventh video misled viewers by encouraging them to invest without making it clear that the content wasn’t is intended as professional financial advice. The study did not conclude whether or not the videos should be misleading. Dimos describes what he sees as an ecosystem of undisclosed paid promotions. “Developers are going to go to the influencer and say,” We want to give you this $ 3,000 token – make a video, overdo it, and then you can sell it for a massive profit, “he says (Dimos and CryptoWendyO state that they disclose all sponsors on their videos as per TikTok’s community standards. Liu did not respond to a request for comment on compensation and sponsorship.)
“Developers will go to the influencer and say, ‘We want to give you this $ 3,000 token – take a video, overdo it, and then you can sell for a massive profit.'”
TikTok declined to comment on this article. Community Guidelines say, in part, “We will remove content that is deceptive to people in order to obtain an unlawful financial or personal gain, including measures to defraud people or steal property.”
Dimos and CryptoWendyO stay away from meme coins, which are usually online jokes that are converted into cryptocurrencies like Dogecoin. “By the time the videos orbit the TikTok algorithm, the coin has already been pumped and dumped,” says CryptoWendyO. It did so on May 12th to Shiba Inu, a meme coin nicknamed “Dogecoin Killer” on the coin’s website. Thanks in part to viral TikTok videos aimed at investor FOMO – “fear of missing out” – the price of SHIB rose in the wake of Dogecoin ‘s parabolic surge, rising 25x in early May to a sell-off of Around $ 1 billion Ethereum co-founder Vitalik Buterin, who was a donation to fight Covid-19 in India, dropped SHIB and several other meme coins.
Dimos believes that all of the cheating – what insiders refer to as “carpet drawing” – that occurs particularly at TikTok not only takes advantage of new, vulnerable investors, but also tarnishes the image of the cryptocurrency. “Every meme coin that exists today feels like a spittoon to people like me who have worked for the professional blockchain industry,” he says.
All the cheating – what insiders call “carpet pulling” – that occurs especially at TikTok, not only takes advantage of new, vulnerable investors, but also tarnishes the image of the cryptocurrency.
After Davies became an early and active member of VirtualBacon’s Discord server, which today has over 20,000 members, he recently joined VirtualBacon in an official capacity, serving as content marketing director for BaconDAO or “decentralized autonomous organization”. Led by Liu, a community of experts shares market research daily, searches for low capitalization “gems” and other insights, while the community can vote on what Liu will cover in his TikTok videos, ask questions, and chat about their topics Trades. Although it is not yet publicly listed, those who buy and hold the $ BACON currency will get access to exclusive content from BaconDAO.
TikTok has exposed a class of new investors to cryptocurrency, but for crypto influencers, it is now becoming a feeder channel for other online platforms like the BaconDAO community and Patreon, where many influencers monetize their Discord channels through fees for access. Young crypto investors appear to be particularly high in mercury. In March 2021, a year and six digits later, Davies got bored on TikTok and deleted it.
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