On April 4, Elon Musk was announced as Twitter’s largest shareholder after purchasing $2.89billion (9.2%) in Twitter shares to outpace Vanguard’s 8.8% shares. With a net worth of $219 billion, Elon Musk has previously shown revolutionary success in several industries like transportation (Tesla), FinTech (PayPal), and space transportation (SpaceX).
Amid propositions from the world's richest man to fully purchase all 100% of Twitter shares, Vanguard Holdings, the second-largest Twitter shareholder, acquired an extra 1.5% stake on April 14 to usurp Elon Musk as Twitter's largest shareholder, with a 10.3% stake.
Regardless of Twitter's corporate ownership battles, it is expected that Elon Musk will bring along revolutionary ideas to the social media industry via Twitter; this has been highlighted by the prevalent free speech debates that have occurred for the past few weeks.
However, away from free speech and other policies, how does this news affect the crypto ecosystem?
It’s no news that Twitter is one of the biggest social media platforms for the crypto community. With nearly 400 million active users, Twitter allows crypto projects to share information, updates, and details about their projects with community members. Also, users frequently debate and share insights and opinions about market trends or the state of a coin. In fact, there is a section of twitter regarded as “Crypto Twitter,” which highlights the large community of people whose primary interest on the platform is to discuss and debate cryptocurrency topics.
The Twitter team is also developing the application for increased cryptocurrency usage and Web 3.0 compatibility; this is exhibited in their partnership with Opensea to allow users to use their verified NFTs as their profile picture; this connects people’s profiles directly to their NFTs by requiring them to authenticate a wallet sign-in. Hence, if a visitor clicks the profile picture, it redirects them to the verified collection on the NFT marketplace. This innovation is done in preparation for the Web 3.0 entry, where people will be identified for their communities with rare and unique NFTs.
A Twitter user who is a community member of the Bored Apes Yacht Club (BAYC) showing off his unique NFT identity via his Twitter profile
Twitter also allows a tipping feature that allows people to tip their favorite influencers with any amount of Bitcoin without incurring significant charges; this is made possible by the Lightning Network. Unlike regular Bitcoin transactions that could take a minimum of 10 minutes, the Lightning network allows instantaneous transactions, which allows tipping via Twitter.
SEE ALSO: Tipping on Twitter and Telegram via CCTIP.
How Will Elon Musk Influence The Crypto Ecosystem via Twitter?
Frequent Twitter users understand the influence of the Billionaire on the community. He is usually attributed as the one man with enough influence to tilt the market direction. For example, in February 2021, when Tesla announced an investment of $1.5 billion in Bitcoin, the market became very bullish, prompting many people to buy coins. The market steadily remained bullish for about two months, with Bitcoin gaining over 70%, moving from $38K to $64K. Due to Bitcoin’s dominance, every other coin followed suit, and holders of several cryptocurrencies were in profit. Unfortunately, Elon Musk tweeted again in May, mentioning that Tesla would no longer accept Bitcoin due to environmental concerns; this caused the Price of Bitcoin to tank horribly, moving from a $64K high to $30K in only a few days.
Not many people wield Elon Musk’s influence on the crypto community; hence, given his newfound power as a significant shareholder of Twitter – a community home for crypto enthusiasts, it could spell good and bad. Elon Musk’s influence could aid the addition of many crypto-related features to Twitter, which will help to onboard traditional users to the world of cryptocurrency. Despite having close to 8 billion people in the world, only about 300 million people have cryptocurrency wallets; hence, the direct influence of Elon Musk could raise adoption levels through the roof. A close example of this can be inferred from DogeCoin.
Elon Musk tweeted severally in favor of the meme coin, making people develop an interest in it. Initially, DogeCoin had no use case, but the influential Billionaire promised to create a use case for the meme coin, and due to his influence, DogeCoin gained over 10,000% in a few months; as a result, he nicknamed himself the “DOGE Father” (a pun nickname for Godfather). While interacting on the Timeline two days ago, Elon Musk suggested making DogeCoin a payment option for “Twitter Blue.”
It is apparent that Elon Musk’s Twitter influence facilitated increased interest in the crypto space, so it is expected that as a significant shareholder, more users will be onboarded to crypto. However, it is feared that frequent market manipulation could occur with much-wielded power, defeating the entire purpose of decentralization.
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