Elon Musk’s $44 billion deal to buy a social media platform
Twitter The crypto world is buzzing. It could have major implications for digital assets.
Tesla (Stock ticker: TSLA) The CEO has always been an outspoken supporter of cryptocurrency — and Musk has put his money in place. Tesla revealed last year that it had bought
$1.3 billion in digital assets remained on the electric car maker’s books as of the end of March. The space company, SpaceX, which is owned by Musk, also owns Bitcoin.
The crypto community – which is very active on Twitter (TWTR) – has been full of speculation about how to change the social media pool and support for digital assets, under Musk’s leadership.
“[Musk’s takeover] It really sparked the imaginations of cryptocurrency investors and enthusiasts,” said Strahinja Savic, Head of Data and Analytics at the crypto derivatives firm.
FRNT FINANCIAL (FRNT. Canada), said Baron.
One important step that Musk could take would be pushing Twitter to buy Bitcoin as a treasury asset, similar to what he did at Tesla and SpaceX. “Given the rise of Twitter in American politics and culture, the company’s acquisition of Bitcoin to hold its balance sheet would be a big deal,” Savic said. From a market point of view, amassing billions of dollars worth of Bitcoin could have an impact on prices.
Twitter’s CFO said in 2021 that investing in cryptocurrency “doesn’t make sense at the moment.” This situation can change if the management catcher shakes.
There is also the issue of dogecoin, which is up more than 30% after news of the Twitter deal. memecoin – so called because it is mostly based on an online joke rather than an important blockchain project –
It is the cryptocurrency most associated with Musk, who played a major role in its rise.
musk Tweeted in April 2021When Dogecoin is trading for 5 cents, “SpaceX will literally put Dogecoin on the real moon.” Prices then rose to 75 cents, and Dogecoin was trading at around 14 cents on Wednesday.
Marcos Sotero, an analyst at digital asset broker GlobalBlock (stock ticker: BLOK.Canada), told Baron News of the Twitter deal “has led to speculators buying Dogecoin due to Elon’s obsession with cryptocurrency, and thus potentially giving Dogecoin more interest on one of the largest social media networks if Elon succeeds.”
Sotiriou said he thinks it’s possible that Musk will somehow integrate crypto payments on Twitter. Twitter late last year Unveiled tipping job Allowing users to send Bitcoin to creators, while in early 2022 Tesla began accepting dogecoin to purchase merchandise on its website. Dogecoin holders may hope Musk’s Twitter sees more of the same.
More broadly, and essentially, the crypto community is watching with interest how a reimagined Twitter might play a role in the broader efforts to decentralize. In focus is Bluesky, an internal Twitter project that resulted from the company and focused on creating a decentralized standard for social media. Twitter founder and former CEO Jack Dorsey – another crypto advocate – is a member of its board of directors.
Michael Saylor, an outspoken supporter of Bitcoin and his company
micro . strategy He was at the forefront of cryptocurrency adoption, He said via Twitter on Tuesday That the social media platform can also solve the problem of scammers and hackers using cryptocurrency.
Musk has highlighted removing “bots” from Twitter as one of his priorities. Saylor suggested that users could transfer some Bitcoin over the Lightning Network as a security deposit to obtain a Twitter verification form.
Either way, the crypto community is optimistic that Musk’s lead on Twitter will lead to broader adoption of bitcoin and other digital assets.
“All you can do is relay information via Twitter, but if you can include ways to transfer value in order to pay for goods and services on the platform, that’s a huge game-changer,” Sotirio said. “The more users you attract to your network – this will help increase prices, as well as the actual value that is transferred.”
Musk will benefit from cryptocurrency becoming more widespread, revealing in March He personally owns Bitcoin, ether and dogecoin – and does not plan to sell them. “He will have a kind of personal incentive” to continue cryptocurrency adoption, Savic said. “He’s made it clear that he’s doing it.”
Meanwhile, market participants are seeing that the billionaire executive continues to cause significant volatility in cryptocurrency prices. “Millions of retail crypto investors are following his every word,” said Pat Larson, CEO of crypto tax program ZenLedger. Baron. Elon’s voice is louder than big crypto companies like
RobinhoodAnd FTX, who all spend billions on consumer marketing every year. “
Write to Jack Denton at email@example.com