Twitter’s quest to become a payment company has taken its first major step with license acquisition. The company announced Wednesday that it has been granted money transmitter licenses by three US states namely: Missouri, Michigan, and New Hampshire.
Early this year, Twitter made a move to onboard payment into its services as part of Elon Musk’s push to create everything app dubbed X, which was incorporated earlier this year.
A state-approved money transmitter license grants official authorization to an entity or individual to legally participate in the money transmission or payment instrument business.
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The aim is to make Twitter a money transmitter in all 50 US states, before expanding the service outside the US – pending approval from regulatory authorities.
The three states’ licenses have set the ball rolling for the social media app, which until its acquisition in October last year by Musk, was solely a space for real-time conversations online.
According to Musk, Twitter aims to launch a payments system by the end of the year, following approvals from both the United States and international markets.
In April, eToro, a social trading company, announced that it has partnered with Twitter to offer financial services within the platform. The partnership would allow Twitter users to access stocks, cryptocurrencies, and other financial assets.
With the licenses, Twitter can now offer financial services such as issuing prepaid cards and providing remittance services involving foreign currencies.
NEWS: Twitter has finally secured its first money transmitter licenses in several US states. pic.twitter.com/gziiRgelYU
— X News Daily (@xDaily) July 5, 2023
Musk’s “Everything App” vision is tied to X.com — a payment company he started and eventually merged with PayPal. He had last April, set up a trio of holding companies in Delaware with a variation of the name “X Holdings”, as part of his bid to acquire Twitter.
Musk paid $44 billion for Twitter but admitted that it was overpriced. He said in a tweet that buying the company was an “accelerant to creating X, the everything app.”
The Everything App mirrors China’s WeChat app, which has a comprehensive combination of various functionalities such as social media, payments, news, and messaging.
The money transmitter licenses were approved by the states at a time when Meta was launching Threads, a real-time conversation platform that CEO Mark Zuckerberg plans to offer as an alternative to Twitter. The app has recorded 10 million users since it was launched by Instagram on Wednesday.
Zuckerberg said he intends to increase the number of Thread users to 1 billion. “It’ll take some time, but I think there should be a public conversations app with 1 billion+ people on it. Twitter has had the opportunity to do this but hasn’t nailed it. Hopefully, we will,” he said.
However, the news of the money transmitter licenses offers solace to Twitter for the chaos the company experienced during the weekend, following a decision by Musk to limit the number of tweets users can view within the app.
Musk has been busy remaking Twitter, while the media keep telling you that Twitter is in its last days…
We will soon learn who’s saying the truth.
Any major social media platform that can robustly offer payment services across multiple jurisdictions will obviously send many fintech startups back to their villages.
We are watching the play.