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Elon Musk, the tech tycoon, has dismissed the possibility of launching a proprietary cryptocurrency token for Twitter or the ‘X’ platform. This assertion was not part of an official announcement, but rather a response to a user’s post on Twitter.
A Twitter user, @DogeDesigner, who has previously interacted with both Musk and Linda Yaccarino, the current CEO of ‘X’, warned that neither Musk nor ‘X’ had released any crypto tokens. This caution came in a tweet accompanied by headlines from news articles wrongly stating that such a launch had occurred. Musk’s retort was simple and unequivocal, “And we never will.”
And we never will
— Elon Musk (@elonmusk) August 5, 2023
Even though this declaration is a definite rebuff to the idea of a cryptocurrency endorsed by Twitter, especially amidst an intense rebranding process, it does not unequivocally reject the notion of future ‘X’ app functionalities associated with cryptocurrencies. Musk’s past affiliations with digital assets also cast a shadow of uncertainty.
Musk’s enthusiasm for Dogecoin (DOGE), a memecoin established initially as a humorous nod to the often serious crypto community, is no secret. The billionaire acquired Twitter for $44 billion last year and promptly replaced its famed blue-bird logo with the Shiba Inu dog image synonymous with Dogecoin, a move that caused the token’s value to jump by 20% and provoked a $258 billion lawsuit against Musk for alleged insider trading and racketeering.
Despite his seemingly contradictory actions towards the crypto community over the years, including his collaboration with Doge developers to create an eco-friendly, affordable alternative to Bitcoin, Musk’s definitive rejection of a TwitterCoin or XCoin leaves the door ajar for potential future cryptocurrency involvements.
“Project X” Goes Way Back
Previously we have reported on the ‘X’ project, that it has always held a special place in Musk’s ambitions. He revealed in the previous year that he has an expansive vision for X.com or X Corporation, although he didn’t elaborate on this grand vision. He suggested during Tesla’s annual shareholder meeting that Twitter could expedite the realization of this vision by three to five years.
In the era of the initial dotcom bubble around 1999, Musk co-established one of the first internet banks, the original X.com. His initial venture, Zip2 – a directory of local businesses – had recently been purchased by Compaq for over $300 million, turning Musk into a multimillionaire. Musk invested the majority of his after-tax earnings from the Zip2 sale, about $12 million, into X.com, foreseeing its evolution into a comprehensive financial services platform.
the core hub where all transactions happen
The original X.com merged with its competitor, Confinity, in 2000 and changed its name to PayPal the following year. After eBay purchased it in 2002 for $1.5 billion, Musk received a significant windfall of approximately $180 million, which he used to invest in the electric vehicle startup, Tesla, and to set up SpaceX, his rocket company.
Musk has always maintained that X.com had the potential to serve as “the core hub where all transactions happen”. He even told his biographer, Ashlee Vance, that he had contemplated reacquiring PayPal.
Musk’s ambition to transform Twitter and X.com into a payments ‘super-app’ exceeds PayPal’s recent aggressive growth strategy. In an investor pitch deck earlier this year, Musk outlined a plan for Twitter that involved enabling peer-to-peer payments akin to PayPal and shifting towards a subscription-based model rather than relying on advertisements. By 2028, he projected over 100 million users would be subscribing to ‘X’.
Regarding the prospect of enabling crypto payments, Musk disclosed in an investor pitch deck that he aims to generate about $1.3 billion in payments revenue from Twitter by 2028. However, experts have questioned Twitter’s capacity to compete effectively, particularly in the US market, which is dominated by powerful rivals like Venmo, Cash App, and Zelle. Furthermore, Twitter’s entrance into the payments industry is anticipated to attract significant regulatory scrutiny, especially given Musk’s controversial decision to cut over half of the platform’s staff, which has raised questions about the platform’s ability to meet compliance requirements.
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