Twitter-based crypto platform Etoro may face a big problem as The Tie-LongOnly CopyPortfolio of eToro could affect their trading strategy.
At the moment, the algorithm usually selects about 13 digital assets to invest.
These digital assets include Cardano (ADA), Zcash (ZEC), Litecoin (LTC), Lumens (XLM), Etherum Classic (ETC), Bitcoin Cash(BCH), IOTA, XRP, Ethereum (ETH), and Bitcoin (BTC).
Etoro’s Twitter strategy could backfire on investors
There is no doubt that any crypto trading strategy that relies on tweets will depend on such tweets for its growth.
The problem here is the fact that it is very difficult to control tweets.
If it receives a lot of negative tweets from fake accounts, it could jeopardize the proper growth of the crypto tool.
According to Spencer Noon, a popular investor at DTC, the idea to leave the market movement of a crypto tool in the fate of tweets is crazy.
It is a gameplay that is destined to fail. He further stated that there is no control over twitter mentions.
Rather, a coin that thrives based on market forces will do much better than another that relies on tweeter mentions, which cannot be trusted.
There are about nine investors in the CopyPortfolio. However, other investors are locking in the sideline.
They want to see how it reacts to the market before jumping on the board. So, if the CopyPortfoio does well in the market, more investors are likely to join.
Some Etoro users still skeptical about the project
Already, TheTIE has come out openly mentioned that it will remove the suspected fake or bottled social media mentions.
However, some eToro users are still skeptical of the success of the project. Their skepticism is because they are still unclear how the project could stand against the volatile market.
nikk87i, a Twitter user, specifically pointed out that there are sentiments that the project will not live on, pointing out some downsides of the project.
These tweets may not be from eToro users or those who want the best for the market.
As it stands, TheTIE has deleted more than 90% of such tweets that discourage other users who are committed to crypto investment.
TheTIE also mentioned that most of the tweets are from bots, suspected shills, and others who want to manipulate the market.
They want to drive the market in a certain direction that will benefit them.
There are more than a billion tweets on Twitter every day. It means the firm needs to filter these tweets and leave only the relevant ones that comment solely for the benefit of the project.
At the moment, TheTIE stated that it completely removes more than 90% of such irrelevant tweets from its decision-making process.
If this is the case, then similar tools about the crypto market could cause a lot of problems for the market.
It will surely affect crypto investors, as tweets and social media posts have a huge effect on the market.