The Musk effect: Cryptocurrency named after SpaceX Starlink gain by more than 140% in three days
StarLink's crypto market had a supersonic price increase on Saturday, when SpaceX launched 53 Starlink orbit satellites into space.
- In an unusual development, a cryptocurrency with the same name as SpaceX's Starlink satellite constellation increased by more than 140 percent after Elon Musk's space technology business sent 53 of them into Earth's lower orbit.
- Written as StarLink (STARL), the obscure cryptocurrency gained 13.70 percent on Nov. 13 — the day of the satellite launch — another 69% the next day, and up to 27 percent on Nov. 15.
- STARL's net returns on investment increased by slightly more than 140% in less than three days, according to data from the OKEx market.
- BTC/USD daily price chart featuring Elon Musk's influence on Bitcoin market.
- However, as stated in its white paper, StarLink is a stand-alone crypto project unrelated to SpaceX's satellites.
Written as StarLink (STARL), the obscure cryptocurrency gained 13.70 percent on Nov. 13 — the day of the satellite launch — another 69% the next day, and up to 27 percent on Nov. 15. STARL's net returns on investment increased by slightly more than 140% in less than three days, according to data from the OKEx market.
STARL/USDT daily price chart. Source: TradingView
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STARL is affected by the "Musk effect."
The name alone served as a unifying factor for StarLink the cryptocurrency and StarLink the SpaceX satellite wing. As a result, traders appeared to have pushed the cryptocurrency through concerted efforts in an attempt to profit from SpaceX's satellite launch event.
Several explanations for this include Musk's influence on the crypto market and the growth of memecoins and the broader "meme-stock" investing phenomena.
It began with the wealthy investor tweeting in support of Dogecoin (DOGE), a parody cryptocurrency, which boosted the token's price to a record high of $0.76 in May 2021 after a year-to-date rise of more than 15,700 percent.
Musk's decision to invest in Bitcoin (BTC) through his other company, Tesla, also helped propel the flagship cryptocurrency from roughly $39,000 in February 2021 to nearly $65,000 in April 2021.
Meanwhile, his critique of Bitcoin's worrying carbon emissions was cited as a contributing factor to the infamous May 2021 crypto meltdown by numerous market observers.
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BTC/USD daily price chart featuring Elon Musk's influence on Bitcoin market. Source: TradingView
Additionally, Musk's cryptic tweets about his beloved dog, a Japanese breed called a Shiba Inu, aided in the price surge of the token's namesake. Trading under the ticker SHIB, the cryptocurrency's year-to-date returns were approximately 375 percent as of the end of October.
Recently, another cryptocurrency named after Musk, Dogelon Mars, soared more than 4,200 percent in October, demonstrating the "Musk effect's" influence on cryptocurrency markets.
However, as stated in its white paper, StarLink is a stand-alone crypto project unrelated to SpaceX's satellites.
It bills itself as a "decentralised metaverse project," with STARL serving as the project's official default money, enabling users to purchase everything from gaming to virtual real estate.
What is the future of StarLink the cryptocurrency?
The most recent round of STARL buying increased the stock's price but failed to produce sufficient upward momentum.
As illustrated in the chart below, STARL's price has been establishing higher highs throughout November, while its relative strength index (RSI) has been sloping downward, portraying lower highs. This is a classic bearish divergence caused by a lack of rising momentum.
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STARL/USDT two-hour price chart. Source: TradingView
As a result, STARL's price may decrease in the next sessions as its persistent parabolic support seeks to prevent it from testing the $0.00064 interim downside target.
Nonetheless, STARL bulls could retest the token's all-time high above $0.00087 by maintaining above the aforementioned price floor.
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