The influence of tech billionaire Elon Musk over cryptocurrency ecosystem is well known. His tweets, which often spark bullish rallies, have most recently sent the price of a token called Cult DAO surging by 84%. CULT, which has a $79 million market cap, is the native token of Cult DAO and the price of CULT is at its 30-day high after the tweet.

This type of reaction is becoming very common in the world of meme-coins. Many investors have jumped on the bandwagon, putting their money into these meme coin assets with hopes of similar gains. Nevertheless, caution is advised as some of these tokens have volatile and unsustainable hype around them.

The Cult DAO coin is not exactly building itself as meme coin, but its behavior showcases the same characteristics with sudden and volatility thereon. It is believed that the Cult DAO coin got the jolt from Musk's tweet due to the fact he has had similar positive impacts with the Dogecoin (DOGE) and Shiba Inu (SHIB) tokens. It is yet unclear how much of a real connection exists between Musk and the Cult DAO team and it is likely that the surge could subside in time.

Overall, as volatility continues to be the name of the game in the cryptocurrency space, investors and traders would do well to understand the risk of touching meme-coins, especially if it’s done without full knowledge or consultation from financial grist.



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