Musk Walks Into Twitter With Crypto Following

Musk Walks Into Twitter With Crypto Following

When Elon Musk walked into Twitter’s headquarters carrying a kitchen sink Thursday (Oct. 27) it was hard not to wonder how the buyer’s remorse was going to affect his stewardship of the third major company of which the Tesla and SpaceX founder is now CEO.

Also, his Twitter bio now reads “Chief Twit.”

It’s not like he needed a way to get his thoughts out and communicate with the world, as his Twitter follower count had not gone up that much to reach its current 110 million.

There are a lot of potential consequences from Musk’s total control over Twitter. Will he replatform banned tweeters ranging from former President Donald Trump on down? Will his attention being divided between three companies hamper his ability to run any of them to the best of his ability?

One thing that’s certain, however, is Musk’s oversight of Twitter is going to have a big impact on the use of cryptocurrencies for payments, to say nothing of their prices.

A True Crypto Believer

Musk has proven in the past that he’s able to shift the value of bitcoin by billions of dollars with a single tweet, and his interest in dogecoin has built it from a created-as-a-joke memecoin into a top-10 cryptocurrency that crypto payments tech providers and payments processes have had to support based on sheer consumer demand.

Dogecoin’s price spiked more than 30% after Musk closed the deal, and that’s probably not all just irrational exuberance. One of the first tweets he sent when word of the deal broke earlier this year was to suggest that dogecoin would be usable for purchases on the social media platform.

He also had Tesla buy $1.5 billion in bitcoin for its treasury, even though his promise to hold onto it did not survive the need to “maximize our cash position” amid China’s COVID-19 lockdowns.

Twitter’s now-fired senior leadership had already embraced crypto payments, with Stripe announcing April 22 that Twitter would be the first client of its new cryptocurrency support. The deal, Twitter Director of Product Management Esther Crawford said at the time, would allow Twitter “to begin offering crypto payouts to creators via Stripe so they have more choice in how they get paid.”

That began with support for the USD Coin (USDC) stablecoin — which is breaking out of the main use as a way to speed crypto exchange transactions into the broader payments market — but could easily be expanded.

Beyond that, Binance CEO Changpeng “CZ” Zhao has confirmed to CoinDesk that the world’s largest exchange had kicked in the $500 million in May that made it an equity player in Twitter.

“We aim to play a role in bringing social media and Web3 together in order to broaden the use and adoption of crypto and blockchain technology,” Zhao said, per the report.

And while Musk has expressed severe doubts about the whole Web3 concept, Binance’s ownership stake will give Musk’s crypto boosterism a strong ally on the board.

Super Twitter

But Musk — who briefly announced plans to sell Teslas for bitcoin until he ran into a wall of environmental criticism and does accept bitcoin for Tesla merchandise — has indicted far broader plans that would turn Twitter into a super app like China’s WeChat.

That would mean something that “does everything, sort of like Twitter, plus PayPal, plus a whole bunch of things, and all rolled into one” Musk said. Noting that such a super app would be a “high-trust situation,” he added that supporting “payments, whether it’s crypto or fiat, can make a lot of sense.”

Musk, who made his first fortune as a founder of PayPal, said in June that “money is fundamentally digital at this point and has been for a while. It would make sense to integrate payments into Twitter, so it’s easy to send money back and forth.”

A Bigger Objective

Crypto payments are unlikely to be the prime concern in the immediate future as Musk has to stabilize the company after removing its CEO and CFO — who sued to force him to close the now-over-priced deal — and get it focused on a new, more aggressive expansion of monetizing the product, dealing with the spam issue he tried to use to torpedo the contract, and addressing what is likely to become a huge public fight about replatforming people banned for hate speech and other behaviors.

Advertising will be a prime objective, Musk said.

Fundamentally, he added, “Twitter aspires to be the most respected advertising platform in the world that strengthens your brand and grows your enterprise.”

Musk has called himself a “free speech absolutist,” but in a post Friday (Oct. 28), he seemed to start walking that back.

He added that he bought Twitter not to make money but “to help humanity,” adding “it is important to the future of civilization to have a common digital town square, where a wide range of beliefs can be debated in a healthy manner, without resorting to violence.”

“That said, Twitter obviously cannot become a free-for-all hellscape, where anything can be said with no consequences!” he said. “In addition to adhering to the laws of the land, our platform must be warm and welcoming to all.”

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