Twitter has been taken private in a deal led by Elon Musk. Although he really created a lot of drama around it, he isn’t the only stakeholder in Twitter now that its last day of public trading on the New York Stock Exchange ended with a flourish at $53.70 per share. (For reference, Elon Musk offered $54.20 per share.)
Binance has a stake worth $500 million out of the $45 billion it cost to take Twitter private. The crypto exchange first expressed interest in May, not long after Elon Musk announced a 9.2% stake Twitter and made an offer. Despite Musk seeming to get cold feet about the Twitter deal for a while, Binance CEO Changpeng Zhao, who often goes the initials “CZ,” said Binance would remain on board if Musk went through with it.
At the time Binance jumped in on the deal to take Twitter private, CZ expressed interest in bringing social media and news to Web3.
Of course, there was the “dumb question of the day”:
Since Binance is on board, it’s rational to assume that Twitter will implement a blockchain-based product sooner or later. In fact, Binance announced that it would help Twitter integrate blockchain.
A text message to Twitter founder Jack Dorsey indicates that Elon Musk had considered the idea of a blockchain-based social media platform.
“The idea of blockchain free speech has been around for a long time,” Musk wrote in a text message in March to former Twitter CEO Jack Dorsey. “The questions are really about how to implement it.”
The text message apparently would have been part of “Exhibit H” in a court battle between Musk and Twitter over Musk trying to back out of the deal – something that could have cause a lot of stress for Binance employees involved in buying its minority stake.
(Meanwhile, Jack Dorsey hasn’t been sitting on his ass. He’s been busy developing the Bitcoin Lighting Network-enabled app “Zion,” which he describes as a Web5 app for creators. Of course, he gets teased about skipping right over Web4.)
CZ did call the investment “small potatoes” compared to other (new) stakeholders in the Twitter deal. Musk sold $15 billion in Tesla stock to help finance the deal. Other stakeholders in the deal include Sequoia Capital Fund, Fidelity Management and Research Company.
Can Musk Pull Off Another Company Turnaround, Though?
Musk has developed something of a reputation for pulling a company back from the brink of bankruptcy. SpaceX was once one bad launch attempt away from bankruptcy and is now one of the fastest growing space launch companies. It even showed a willingness to launch satellites for OneWeb and might do the same for Amazon’s Project Kuiper even though these two companies compete with its Starlink satellite Internet service and sometimes gave SpaceX and Starlink trouble with regulators acting as referees.
Tesla went from being nearly bankrupt due to difficulties with the Model 3 but made enough gains for its stock to briefly be part of the S&P 500. It opened Gigafactories in Germany and Texas. Shareholders might keep their fingers crossed that it can actually start shipping electric Semis by the end of the year as promised. However, Tesla now looks like a respectable, if still relatively new, auto manufacturing company.
Can Musk do it a third time? Well, he mostly seems interested in doing a bit of housecleaning. Twitter CEO Parag Agrawal and CFO Ned Segal left the company on October 27 – just before the deadline for the deal to close. More than a thousand employees left Twitter on their own since Musk tendered the original offer in April, with most of them finding jobs at other tech companies like Google and Meta.
At least one Twitter employee mentioned that most of the former employees just didn’t want to work for Elon Musk. Others may have simply had concerns about Musk’s plan to lay off as much as 75% of Twitter’s 7,500 employees – something he has since backtracked on a little bit. A minority of departing employees might have been just normal turnover.
Elon Musk also put a quantifier on his stated intention to promote free speech on Twitter, saying that he wouldn’t tolerate illegal activity like death threats. He is standing firm on his intention to combat Twitter’s bot problem, though – something that Binance says it can help with. In messages to his brother, Kimbal Musk, he mentioned that he could charge a small amount of his favorite cryptocurrency, Dogecoin, per Tweet, a likely temporary measure that could cut down on bots and spam tweets.
Over the months of Elon Musk dragging his feet about the deal, Twitter had expressed concern that Musk might use its internal data to build a competitor – something that he had hinted at in messages to Kimbal.
“I think a new social media company is needed that is based on a blockchain and includes payments,” he told Kimbal in April, when he was still going back and forth with Twitter about a possible acquisition or a seat on Twitter’s board of directors.
Musk did promise advertisers that he wasn’t going to ignore their concerns and Twitter would not become a “free-for-all hellscape.” However, GM has already pulled its advertising out of concern about Twitter’s future.
Twitter developers are already testing integration of a few NFT marketplaces to enable NFT trading directly on Twitter. This could be a hint of a future Twitter-based marketplace for creators.
Twitter likely could benefit from an overhaul that includes getting rid of the bots, spams, and even the spams and occasional cybersecurity incident. Binance expressed an interest in helping with any future blockchain-based products that Twitter will develop under Musk. With Binance’s help and a little internal housecleaning, Musk might get his desired “everything app.”