Original Author: Kyle
Elon Musk, who once openly said he wanted to “copy WeChat,” has been gradually adding payment tool attributes to this social platform after acquiring Twitter, and has taken a bigger step forward.
After renaming Twitter to X, it obtained a cryptocurrency payment license issued by the state of Rhode Island, USA at the end of August. This means that this social platform can provide storage, payment, and transaction services for cryptocurrencies to some users. Prior to this, X had already obtained fiat currency payment licenses in six states in the United States.
By adding payment genes to the social platform, X is heading towards the path of “WeChat Pay.” Not only that, Musk also announced that X will launch voice and video call functions.
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Now it seems that “copying WeChat” is not just a joke for X, but with Musk’s business experience, imitation is not the end. His ambition to transform Twitter is to turn it into a super app, not just in terms of functionality, but also in terms of influence.
Currently, X’s 541 million monthly active users are still not in the same league as WeChat. The difference in “mass base” is an important reason for the gap between the two, and the globally circulating cryptocurrency is seen by Musk as a breakthrough.
X obtains cryptocurrency payment license
X (the predecessor of Twitter) is moving forward with Musk’s vision of a “super app.”
On the evening of August 29th Beijing time, X’s subsidiary, Twitter LianGuaiyments LLC, obtained a “Currency Transmitter” license in the state of Rhode Island, USA.
Compared to the general currency transmission license “Money Transmitter,” the creation of Currency Transmitter is to replace electronic currency transfer devices. It is worth noting that this license allows holders to transact on behalf of others, including virtual currencies including cryptocurrencies, with authorization. This means that X can now support users in storing, transferring, and exchanging cryptocurrencies.
The social media giant with over 541 million monthly active users has actually been adding payment tool attributes since Musk took over. As early as January this year, the Financial Times reported that Twitter was actively introducing payment functions and applying for regulatory licenses across the United States, while developing the software needed to introduce payment functions.
The US licensing system (NMLS) shows that as of now, seven states in the United States have issued financial service-related licenses to X. In addition to Rhode Island, Arizona, Missouri, Georgia, Maryland, Michigan, and New Hampshire allow X to provide fiat currency payment services.
X subsidiary has obtained 7 payment licenses
Turning a social platform into a payment tool is a familiar strategy for Chinese users. Some netizens commented, “Isn’t this just WeChat?”
Indeed, before acquiring Twitter, Musk openly proposed “What if we copy WeChat?” in an internal meeting. He said that the West does not have a national-level app like WeChat, where people can do almost everything with it. Then, someone next to him added, “Buy Twitter, copy WeChat.” Musk smiled slightly, “Yes, that’s about it.”
Elon Musk, who is known for his swift actions, has actually done it. After acquiring Twitter, he not only started building financial services functions similar to “WeChat Pay,” but also copied WeChat’s “magic weapon for success” of voice and video calls. On August 31st, Musk posted that video and audio calls will soon be available on X, and can be used on Apple, Android devices, as well as Mac and PC. “No phone number needed, X is the global address book.”
This is an operation that Chinese netizens are very familiar with. Back in the day, WeChat emerged and single-handedly dealt a heavy blow to the three major telecommunications operators. Nowadays, most calls and video chats between friends and family happen on WeChat. The ones who call you are usually delivery guys, takeaway boys, and advertising salespeople.
When Twitter changed its name to X in July, Musk stated that he wants to reshape Twitter into a super platform that combines communication and finance. “In this case, the name Twitter no longer makes sense, so we must bid farewell to this blue bird.”
Twitter is an onomatopoeic word for chirping birds in English, and its social implications are stronger. In contrast, X appears to be all-encompassing, capable of carrying everything, including the ambitions of the madman Musk.
Super WeChat with Multiple Variables
Musk is forcefully driving the transformation of Twitter. But given the personality of this madman, he is never content with being a follower. After copying WeChat, the next step could be “Super WeChat.”
Currently, WeChat has over 1.3 billion monthly active users, while X has 541 million monthly active users. In addition to basic social functions, users can find almost all internet services on WeChat, including payments, wealth management, publishing and reading articles and videos, and shopping, buying tickets, and playing games through a massive number of third-party mini-programs.
Even if X has a solid foundation overseas, surpassing China’s long-standing top-ranked national-level application is not an easy task. Even if it can add payment functions and rapidly integrate various third-party applications, the gap in user numbers remains.
According to the audience reach data released by Twitter’s self-service tool in January of this year, X’s main user groups are in the United States and Japan. It has 95.4 million active users in the United States and 67.5 million active users in Japan. Behind them are India, Brazil, Indonesia, the United Kingdom, Turkey, and Mexico, with active user numbers of 27.3 million, 24.3 million, 24 million, 23.2 million, 18.6 million, and 17.2 million respectively.
Unless X can find a new platform that can reach more global users, making it convenient enough and needed enough. In this regard, the recently obtained “cryptocurrency payment license” may be an important variable.
Compared to traditional fiat payment and cross-border transfer services, cryptocurrencies circulating on open-source blockchains naturally have the attribute of being borderless. By utilizing blockchain technology, encrypted asset transactions do not require approval and verification from central authorities, resulting in faster and more efficient transactions and circulation, as well as reduced friction costs in intermediary processes.
In this financial revolution brought about by this technology, the only rule that needs to be established by the external world is how to effectively combat money laundering. After all, there have been an increasing number of cases involving illegal or even criminal activities using cryptocurrencies. Compliance has become the main pursuit for many cryptocurrency service providers looking to expand their business scope.
If X can become a compliant global cryptocurrency payment platform, carrying out cross-border transfers, cross-border payments, and other businesses, it will become a huge advantage for X compared to WeChat.
Currently, although WeChat Pay has expanded its operations to over 60 countries and regions, supporting multiple fiat currencies including GBP, HKD, USD, JPY, it is still based on traditional methods. Especially in cross-border business, although efficiency has improved, the cost is far from that of the cryptocurrency network.
For X, becoming a payment tool is its direction of “learning from WeChat”, but obtaining cryptocurrency payment licenses in the state of Rhode Island in the United States could be its breakthrough to “surpassing WeChat”. Considering the openness of US regulations towards cryptocurrency policies, X also has a natural policy advantage.
Of course, obtaining regulated cryptocurrency licenses on a larger global scale is also a long-term challenge for X to become a global payment tool. According to a global cryptocurrency regulatory report released by PwC earlier this year, among the major countries and regions worldwide, only 11 support the legalization of cryptocurrencies, including the United States, the European Union, Canada, Australia, Japan, and others. In addition, there are several countries that explicitly prohibit the use of cryptocurrencies, including China, Qatar, and Saudi Arabia.
In other words, X’s ability to attract more users through cryptocurrency payments largely depends on global regulatory attitudes.
At the same time, in the United States, financial companies such as LianGuaiyLianGuail, Block, Stripe, and others have already launched cryptocurrency payment functions. These native financial enterprises will also be X’s external competitors and, of course, may also become partners.
X’s transformation into a super app is another ambition of Musk. Imitation is just the first step, and expansion is the ultimate key. Now, he has revealed the cryptocurrency card…