Stocks that had nothing to do with Elon Musk’s words surged 12 times. This is attributed to the infinite trust of some investors in Musk and the tremendous liquidity that has been released in the stock market.
On the 7th (local time), Musk’s CEO posted a message saying “Use Signal” through Twitter. This was interpreted to mean using a messenger app signal that protects personal information instead of Facebook (Messenger) and its subsidiary WhatsApp.
Musk’s tweet seems to be related to changes to Facebook’s privacy policy. Facebook recently changed its privacy policy and terms of use so that WhatsApp users cannot use the service unless they allow Facebook to share their personal information. Musk has been criticizing Facebook’s privacy policy since the past.
Twitter CEO Jack Dorothy also retweeted Musk’s tweet that day. As new users flocked, the messenger app Signal also announced that “too many new users are trying to sign up, and the sending of the authentication code is currently delayed.”
This sparked a wrong wave in the stock market. The stock surged immediately after Musk’s tweet, rising 527% on the 7th and 91% on the 8th as some investors flocked to the over-the-counter stock called Signal Advance. The stock, which was 60 cents a share on the morning of the 7th, has risen to $7.19 as of the 9th. The market capitalization increased from $55 million to $660 million.
The problem is that this company has nothing to do with messenger app signals. Signal Advance is a healthcare-related company founded in Texas in 1992. Due to its small size, financial information is not reported to the US Stock Exchange (SEC). According to CNBC, as of March 2019, there are no full-time employees other than CEO Chris Heimel.
The messenger app Signal Musk mentioned is an open-source app that receives donations from the non-profit Signal Foundation and provides it for free. Edward Snowden, who exposed the interception of the US National Security Agency (NSA) in the past, said he was using a signal app.
“It’s understandable that people want to invest in Signal’s record-breaking growth, but that company (Signal Advance) is not us,” Signal Foundation said.
Reporter Kim Hyun-seok [email protected]
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