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The Twitter buyout saga is finally over. On October 27, Elon Musk closed the $44 billion deal, which has left him in control of the social media platform and with a $13 billion debt that has helped him acquire it.
There are several changes that this acquisition will bring along, notably the firing of some of Twitter’s 7’500 employees (three top executives have already cleared their desks).
However, what interests us most as crypto industry observers are potential crypto developments that Twitter can implement under Musk’s reign – and their impact on the markets and the industry in general. Let’s try and see what these could be.
Twitter is no stranger to crypto. Prior to the takeover, it has already implemented several crypto features: creators’ Tip Jar enabled tipping accounts with Bitcoin via a Lightning Network wallet provided by Strike (only in the US though), and a special hexagon-shaped avatar frame allowed to prove the ownership of a profile picture NFT, which meant a great deal for the NFT community user identification.
These features were developed by an internal team that Twitter had since November 2021 (and which probably has a better shot at staying employed even after Elon’s purge).
The takeover will also bring another source of crypto brains to the company: the exchange giant Binance, which helped Musk with some $500 million to fuel the deal, will also contribute to the platform’s crypto development. Binance’s CEO CZ said that the company aims to “play a role in bringing social media and Web3 together in order to broaden the use and adoption of crypto and blockchain technology”.
There are several possible crypto vectors for Twitter now: a wallet, NFT integrations, fighting bots with blockchain, and some use of Doge.
Musk has often spoken about his desire to create X, an “everything app” which would combine a social media, a messenger, a digital wallet, a video conferencing app, a taxi hailing app… basically whatever a user might need, not unlike the Chinese WeChat.
With this in mind, it would be natural to start with the creation of a crypto wallet embedded into Twitter, pouring foundation for myriad of future commercial possibilities, including content monetization, selling goods and services through Twitter, developing in-app games and many more.
Such wallet may already be in the making: Jane Manchung Wong, “the woman scooping the Silicon Valley”, has already shared the news about Twitter “working on a wallet prototype that supports crypto deposits and withdrawals”.
Binance, which has itself developed a popular wallet Trust, could surely help with a Twitter wallet, but we (the users) must stay careful as to its nature. From security standpoint it is crucial that the wallet is non-custodial, i.e. allowing users to manage their own keys. Also, it would be important to secure and conceal the links between user accounts and their crypto addresses, for privacy considerations.
This might not be easy, especially taking into account that Twitter has had its share of security problems, the last one happening just over 2 months ago. This August, the platform suffered a data breach that affected 5.4 million users: an attacker got their email addresses and phone numbers. Twitter’s ex-head of security even went public, accusing the company of “negligence and willful ignorance”. This definitely has to change before any wallet comes in.
One of the possibilities unlocked by a wallet (and enhanced by the NFT profile picture) could be the creation of exclusive communities, for example for the owners of a specific NFT collection. Some users have already mentioned Twitter’s “Discord-killer” opportunity, and taking into account how complicated Discord actually is, there might be a demand for this.
In the meantime, Twitter has rolled out another NFT feature this Thursday: called NFT Tweet Tiles, it is a new way of displaying URLs leading to NFTs on marketplaces, making it easier to buy, sell and display the NFTS. For the moment only four NFT marketplaces have been chosen for the test: Rarible (curated NFTs), Dapper Labs (sports NFTs, including NBA Top Shot), Magic Eden (Solana NFTs) and Jump.trade (cricket game NFTs).
This step, however small, can lead Twitter to become one of the vehicles of the future NFT economy, which could be further boosted by an in-built wallet.
The acquisition discussions lasted long enough for all of us to learn that Twitter has a lot of bots, and Elon does not like them. Here too, Binance could come to the rescue. The company’s spokesperson told last week that Binance was creating an internal team to focus on ways that blockchain and crypto could be helpful to Twitter. For example, by building on-chain solutions to address some of Twitter’s issues, such as the proliferation of bot accounts in recent years.
It is not yet clear what strategy will they use, but this is a direction.
Elon is widely known as “Dogefather”, thanks to his continuous support of Dogecoin, a cryptocurrency forked off Bitcoin back in 2013. Initially launched as a joke, the memecoin has spun into much more, gaining followers and eventually forming a community.
Elon Musk has been something of a god fairy to Doge, regularly pushing its price up with his tweets, but never committing more than accepting DOGE for Tesla merch (not the Tesla cars). Despite this rather light support, the buzz has helped the DOGE become the 8th biggest cryptoasset by market cap.
The Doge community hopes that Twitter takeover by their spiritual godfather would bring some utility to the coin, for example by enabling Doge payments and tips within the app.
Since the Twitter acquisition news hit the internet this week, $DOGE price has gained 100% in anticipation of some Doge-friendly gesture. So far, nothing concrete and/or significant was ever done by Elon to justify that, but as often, markets react to words, and Elon is particularly generous with those.
Another cryptocurrency to have a reaction to the news was $BNBCoin, which gained 11% since it broke out. Binance is likely to play an important role in Twitter’s future, and vice versa. Such privileged access to 238 million of Twitter users will surely be exploited by CZ and Co to the maximum: BUSD as an official app stablecoin? custodial wallet allowing crypto-fiat exchanges? link to Binance’s DEX (decentralized exchange) trading possibilities? The list can go on…
While the possibilities for Twitter developments are plenty, Elon Musk should also keep an eye on his competitors. There are at least two social media platforms in the making, which could pose a serious threat to Twitter: Jack Dorsey’s Bluesky and Tether’s Keet are exploring new ways of sharing and moderating content, not without blockchain of course. More crypto-specific protocols like Lens, recently developped by Aave, or even Ecency, are quite interesting to observe as well.
The social media landscape is slowly changing, and this is good both for society and the crypto industry.