Diamond hands: What do the emojis that Elon Musk tweeted about crypto crash mean, and what do they have to do with bitcoin?

SpaceX founder and Tesla CEO Elon Musk visits the construction site of Tesla’s gigafactory in Gruenheide, near Berlin (REUTERS)

Elon Musk has tweeted to say that Tesla will not be selling off any of its bitcoin stock, despite the ongoing and dramatic crash in cryptocurrencies.

But the billionaire put it much more succinctly, with a set of emoji intended to signal his company’s view:

The emoji are a reference to meme in which holders of specific assets – not just cryptocurrencies, but stocks too – make clear that they are holding onto them, despite any possible downturn.

Specifically, Mr Musk was saying that Tesla has “diamondhands”, or that it does not intend to sell. It is a reference to a slang term used online that has grown with the interest in trading assets in recent months.

People with “diamondhands” are contrasted to those with “paperhands”. That refers to people who are, in the speaker’s view, too anxious to sell; where people of the former view have a hard commitment to the asset, the latter’s belief is seen as overly soft.

The slang rocketed to popularity in another recent financial market frenzy: not cryptocurrency, but the GameStop affair, during which people bought unusual stocks in the hope that they would surge. It came into focus on the WallStreetBets forum on Reddit, where traders encouraged others to be diamondhands and not to sell their stocks at difficult times.

As such, it is also related to a whole set of different terms that grew famous as a result of that forum and its activities in the stock market. Another is “tendies”, for instance, which literally refers to “chicken tenders” but is used metaphorically to refer to the profits that will result from gains in the stock.

The use of diamond and paperhands is perhaps broadly similar to the “bull” and “bear” or “long” and “short” language used in more traditional financial markets, as a way of indicating a person’s view on the future performance of an asset and whether it should be held onto or sold.

But it also has another function, too: on WallStreetBets and other forums, users see it as a way of rallying their fellow investors, encouraging them to stick with their holdings even if things are looking bad. As such, Elon Musk’s tweet might not be viewed only as an indication that Tesla is sticking with its holding, but that he expects other people to do the same.

While Tesla’s bitcoin holding was announced in February, it has been under particular scrutiny in recent days. This week, Mr Musk seemed to hint that Tesla might have sold its position in bitcoin – causing the price to crash – but later clarified that he hadn’t.