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Musk, Twitter and payments

The building of a payments network isn’t, in fact, all that tough. It’s been done several times in the past 30 years after all.

The thing that’s needed is the network of people willing to use it. Just like any other social thing. You need the audience to produce the revenue to pay the bills.

What’s Musk got a Twitter? Couple of hundred million people already logging in.

Doesn’t seem a stretch that he can make that work.

4 thoughts on “Musk, Twitter and payments”

  1. What are the margins on a payments business these days? Inter-bank transfers are free, in the US there’s Zelle which is free. Does he just miss PayPal?

  2. @Andrew M
    Depends how long you get to keep the money on deposit. The marginal costs of running a payments business are negligible, it’s all in the operational overheads. Let’s say it costs $10M pa to run — I suspect it could be done a bit cheaper than that — with 200M users they only need to make 5¢ per user per year from payments; they can probably do that purely from fx margin.

    Add that they want to have their own Patreon equivalent and at that point can force people to use their payment system and then anything over and above that is gravy.

  3. “Depends how long you get to keep the money on deposit.”

    If he sets it up the way he scetches in that transcript.. Interwebz chargeable debit card, with possibly an internal Twatcoin conversion for use within the Garden…

    Most users would toss €/$ 20-50 on it and just let it dwindle in …tips and stuff.. Ko-Fi, Patreon, tips for artists with livestreams somewhere else, but with a Twitter account. Things. It depends on extra charges and fees, and the sanity of…

    Fairly slow turnover, measured in weeks, if not months. Plenty of time to do Financy Stuff with for Profit and avoid being caught with the pants down like an amateur.
    And there’s the White Noise effect with millions of users adding/retreiving cash where you get a certain level of liquidity that’s pretty much there indefinitely as long as the herd doesn’t get spooked..

  4. Matt, you’re reminding me of the evil innovation that they’ve introduced on our bus system here in Brisbane. (I’m sure it’s been in place for years, but I’ve never noticed.)

    One can’t just pay cash for a bus trip. One must buy a go card, leaving some of your money on deposit.

    So this saves them the cost of dealing with cash transactions, and you pay them for the privilege. It also allows them to track each transaction. I’m sure they’d much prefer to cancel all unregulated and unobserved cash transactions if they could.

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