On April 14, 2022, it was announced that Elon Musk had reached an agreement to acquire Twitter. After months of back and forth between Musk and the company, the deal was closed in late October for around $44 billion. This is a significant development for the cryptocurrency industry, as Musk has been a major proponent of crypto assets. With the past month of Musk’s ownership as context, let’s take a look at what this acquisition could mean for the future of Twitter and Web3.
For the past year or so, Musk has been a major influencer in the cryptocurrency industry. He first brought Dogecoin to mainstream attention in early 2021, when he tweeted about it several times and even made it his profile picture on Twitter. DOGE surged to an unbelievable $80+ billion market capitalization as a result, and Musk has continued to tweet about the cryptocurrency on occasion and promoted it within his companies by allowing customers to purchase Tesla merch using Dogecoin.
In April 2021, Musk unveiled his plans for X, a new social media platform that he said would be the West’s “everything app,” like what China has with WeChat. It’s speculated that the X platform could support social media, digital payments, messaging, live streaming, and much more. It’s not yet clear if X will have any cryptocurrency-related features, but given Musk’s history with both crypto and Twitter, it’s certainly possible that some integration could be in the works.
There are a few potential scenarios for how this acquisition could play out with respect to cryptocurrency integrations on Twitter.
The first possibility is that nothing much changes. Even though Elon Musk is now in charge of Twitter, it’s unlikely that he will want to make radical changes to the platform right away. It’s possible that we might see some small changes, such as the incorporation of Dogecoin tipping, but it’s doubtful that anything major will change until after X’s release.
Another possibility is that we see an increase in cryptocurrency integrations on Twitter as part of a larger effort to position the platform as a competitor to existing social media sites like Facebook and Reddit. This could include things like built-in wallet support, tipping mechanisms, and integrated exchanges. Reddit already has cryptocurrency rewards for some of their communities, and some sort of similar mechanism for Twitter could help grow adoption and make the company more financially sustainable. Given Musk’s history with crypto assets, this scenario seems quite likely.
One unlikely scenario would see X become the new home for all things crypto-related while Twitter remains focused on traditional social media topics. In this situation, we would start seeing less and less crypto content on Twitter as users migrate to X for their crypto needs. This seems like the most unlikely possibility, as decentralized social media platforms like Lens Protocol and Farcaster are already the migration point for crypto Twitter users. And it makes no sense for Musk to limit his grand vision for X to just the cryptocurrency community.
The most likely outcome seems to be that Twitter will be integrated into X as its main social media platform, and other features like payments and streaming will be built up around it. This would make the most sense, as it would explain why Elon paid so much for an unprofitable Twitter: its captive user base that will have no choice but to switch to X when it releases. If Musk does choose to emphasize blockchain on X, it will be massive for Web3 as it will mean the immediate onboarding of hundreds of millions of users.
Only time will tell what effect (if any) Elon Musk’s acquisition of Twitter will have on the cryptocurrency industry. However, given Musk’s history with crypto assets and social media platforms, it’s certainly possible that we could see some major changes in how Twitter integrates with cryptocurrency in the coming months or years.
By Lincoln Murr