A quick reminder and recap what the rebranding of Twitter as X is about:

The rebranding of Twitter into X seems to signal that Musk uses the platform as basis for becoming a fintech company.¹ (Musk already registered Twitter Payments LLC with the Treasury Department’s Financial Crimes Enforcement Network. https://cdn.arstechnica.net/wp-content/uploads/2023/02/Twitter-FinCEN-registration-2022.pdf )¹

But Musk is not alone in that or even the first. In 2019 Zuckerberg planned the same for Facebook with the introduction of the crypto-currency Libra.²

At that time Libra seemed to have gone nowhere as Visa, Mastercard, ebay, and PayPal pulled out of Libra project in 2019.³

Still, the fintech Libra Networks was registered in Zurich, Switzerland, in 2019 for Facebook (2,5 billion users in 2019) and its subsidaries Instagram, WhatsApp, and Messenger (each about 1 billion users).⁴

So the difference seems to be that whereas Zuckerberg in 2019 tried to establish financial services based on crypto-currency throughout his platforms, it is not clear whether Musk wants to rely on crypto as well (as crypto was one major reason the aforementioned Visa, Masertcard, PayPal pulled out of Libra).

But both projects planned to become an "online bank" of sorts. With the difference that as a fintech, by siphoning off user data, data of purchases, and behavioural statistics no bank is allowed to do, they can create financial products much faster and distribute them via their platofrms far more widespread than any bank could.⁵

In fact, back in 2019 Zuckerberg didn't seem to realise but Musk now does seem to understand that both platforms are not or are no longer in the ad-business but in the online banking business. That is: Hitherto both platforms thought of their business as creating profits by selling ads to users who in exchange for their eyballs are permitted the free use of these platforms. But should the transition from ad-business to fintech prove successful, this will have major impact on the global financial markets and banking sector -- up to the default of major banks.

Obviously, the syphoining-off of behavioural user data is not only relevant in the financial and banking sector but in all areas where "prediction products" can contribute to manufactoring, product development, AI training, purchasing optimzation, etc. These "prediction products" can even themselves be traded in what Shoshana Zuboff has called the "behavioural futures markets".

Combine state surveillance with capitalist surveillance, and the separation of people in two groups (the more or less hapless customer-citizens on the one hand and the unaccountable producer-citizens on the other) has significant consequences on democracy as "asymmetries of knowledge translates into asymmetries of power".⁶

But even without the societal and political ramifications, the economic and financial look most impactful. No wonder that Musk expects Twitter/X to "be ultimately extremely valuable"¹ And it may explain why Zuckerberg shows interest in the #fediverse. He who creates the first global "banking app" will rule the field. A pretty dire development from the days when m-pesa was created to link African agricultal communities an dcustomers in 2007.⁷

----------

¹ Ashley Belange, "Fast-moving Musk makes very slow progress turning Twitter into 'everything app' " https://arstechnica.com/tech-policy/2023/03/fast-moving-musk-makes-very-slow-progress-turning-twitter-into-everything-app/

² Kari Paul, "Libra: Facebook launches cryptocurrency in bid to shake up global finance" https://www.theguardian.com/technology/2019/jun/18/libra-facebook-cryptocurrency-new-digital-money-transactions

³ Orion Rummler, "Ahead of Zuckerberg testimony, new setbacks for Libra" https://www.axios.com/2019/10/12/mark-zuckerberg-libra-facebook-congressional-testimony

⁴ Brenna Hughes Neghaiwi, "Facebook forms Swiss fintech firm with payments focus" https://www.reuters.com/article/us-facebook-switzerland-payments/facebook-forms-swiss-fintech-firm-with-payments-focus-idUSKCN1SN1ZT

⁵ Billy Bambrough, "Global Fintech Warning To Traditional Banks -- The Threat Is 'Real And Growing' " https://www.forbes.com/sites/billybambrough/2018/10/17/global-fintech-warning-to-tradional-banks-the-threat-is-real-and-growing/

⁶ John Naughton, " 'The goal is to automate us': welcome to the age of surveillance capitalism" https://www.theguardian.com/technology/2019/jan/20/shoshana-zuboff-age-of-surveillance-capitalism-google-facebook

⁷ NN, "Vodafone M-Pesa comes to Europe for the first time" https://www.vodafone.com/news/technology-news/m-pesa-romania

----------

#fintech #crypto #Twitter #Musk #facebook #Zuckerberg #mpesa #surveillance #capitalism
#sources