Key Takeaways:
X (formerly Twitter), the social media giant owned by the father of Dogecoin (DOGE) and prominent advocate of cryptocurrencies Elon Musk, is working on launching a payment service on its app.
But to everyone’s surprise, the company revealed that its payments network won’t support cryptocurrencies, at least in the first phase.
X’s Payment Platform will not Support Cryptocurrencies at Launch
X Payments, as it will be called, is expected to be launched later this year and will function similarly to services offered by Venmo, Apple Pay, or PayPal. Twitter Payments LLC, the financial arm of X, recently received its money transmitter license in the US state of New Hampshire.
The company has since submitted documents related to money transfer licenses to financial regulators in 11 states, revealing that the system will primarily be used to settle payments in fiat currency, with crypto functionality being added later.
The absence of cryptocurrencies in X Payments has elicited mixed reactions within the community. While some see the move as a slap on the face for cryptocurrencies as it could stifle adoption rates, others say it is a strategic decision taken by the company that could be revised in the future as the regulatory landscape surrounding cryptocurrencies and their use for payments stabilizes.
X has been Granted a Money Transmitter License in 25 US States
X was recently granted a money transmitter license in Tennessee and Nevada. Musk also revealed that the company is waiting for its license to be approved in New York and California.
According to a report from Reuters, the Tesla and SpaceX CEO said that a California license was a month or so away, while the New York license could be a few months away from fruition.
X has now received a money transmitter license for payment services in 25 US states, including Utah, Florida, Nevada, Arizona, Oregon, Michigan, Arkansas, and Georgia. Earlier this year, the company said it will soon begin offering peer-to-peer payments for its users.
Since the time he acquired Twitter in April 2022 for $44 billion, Musk has sought to transform how the social media network operates. He first oversaw a massive rebrand of the company, now known as ‘X’, and has envisioned a plan to turn the platform into an “everything app” similar to China’s WeChat.
The money transmitter licenses are critical for Elon Musk’s ultimate vision for X, and if it can be obtained in all states, then there will be a massive shift in how the public perceives and utilizes the social media platform.
While discussing his plans for X last year during a company meeting, Musk said anything that involves money, be it cash or securities, “it’ll be on our platform”. He does not see X as just a payment service provider, but as a platform that will replace the need for a bank account.
X Payments Poised for Launch in the US Later This Year
Musk wants X Payments to be rolled out in the US before the end of this year.
In a blog post made after obtaining licenses in Pennsylvania, Utah, Kansas, South Dakota, and Wyoming, the company wrote that X is not just another app but is becoming the “everything app” that seamlessly unites experiences into one interface, for everyone.
Although Musk’s decision not to include cryptocurrencies in X Payments has disappointed most crypto enthusiasts, it represents a significant advancement for the social media platform.
With the potential introduction of a digital payment service, X could become a major player in the payments sector dominated by heavyweights like Visa, which remains rooted in the traditional monetary system.
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