Thursday, May 2, 2024
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2022-04-20
By Az
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Social Media Wars: What’s Going on With Twitter

Elon Musk, CEO of Tesla and founder of SpaceX, recently purchased a significant stake in Twitter. 9.2%, to be precise. There is a lot of buzz on the platform itself with Musk’s announcement. It’s front and center, but many don’t know the potential outcomes this could have. We are talking about whether or not social media platforms like Twitter, which many have come to know as free speech public forums, are as open as we think. At the same time, a question is being raised as to whether we need a decentralized platform to counter today’s legacy ones.

Let’s see what’s going on and look at what may come.

It all started when just last week, Elon Musk announced that he had purchased a 9.2% stake in the public social media company Twitter for $2.9bn, becoming its largest stakeholder. To put this into perspective, Jack Dorsey, former CEO and founder of Twitter, owns just 2.25% of it.

Many started to question the future of the platform and the role they would play on it, threatening to leave the platform altogether. In contrast, others speculated that Musk, a great advocate of the popular meme coin DogeCoin, might integrate DOGE payments into the platform. This is after Jack Dorsey launched Bitcoin payments on it.

Excitement and fear both lingered in the air, with many questioning why a billionaire like Elon Musk suddenly showed an interest in owning part of Twitter. The fact is that Musk has a following of over 80m users on the platform.

Shortly after, Musk offered to buy Twitter entirely and take it private at $54.20 a share. The offer can be seen in the SEC document here.

If the criticism wasn’t enough, people started thinking that Elon Musk might want to control the largest social media platform in the world to benefit certain agendas. This could also be counterargued with the statement that Musk has enough momentum as a public figure that he might not necessarily need to win the entire platform to get across what he wants to say. Musk, after all, has fallen under a few times in the past for his outspoken ways.

In an unexpected plot twist of the narrative of who is trying to control what, the Twitter board decided to block Elon Musk from gaining control of the platform altogether. This would be achieved by issuing more shares and diluting the existing ones to reduce Elon Musk’s stake.

In what seemed like a strategic move, Elon Musk had already held a poll on Twitter, asking its users if the decision to take the company private should be up to the board of directors or the shareholders. Nearly 3m people voted in the poll, and the result came in with a whopping 83.5% of people in favor of the shareholders having the final say in the decision.

 

As a result, Elon Musk took to Twitter again to make the point that, going against the interests of the majority of shareholders, the board would be in breach of their fiduciary duty. The question is why the current board would want to prevent Musk from taking control of the company in the first place, so much so that they would consider acting unconstitutionally to prevent such a move. We await to see how this plays out.

Interest in the situation increases

After the initial offer of $54.20 from Elon Musk, one other entrepreneur jumped in to make a higher one, of $60. This was none other than Justin Sun, founder of the TRON blockchain.

He shared his sentiment of making Twitter crypto native and Web3 friendly in his tweet. However, it is unknown how serious he was about the offer, seeing as his net worth is estimated at $200m.

 

Charles Hoskinson, founder of the IOHK (Input Output Hong Kong), whose key project is Cardano, a public blockchain and smart contract platform, also jumped into the conversation. Hoskinson openly addressed Musk, offering to co-build a decentralized platform with him.

Hoskinson is well known in the web3 industry for his meticulous approach to coding, ensuring everything is sitting as best as possible before being released to the public.

An open, decentralized social media platform has been discussed by many Twitter users in the last year. However, decentralized web3 social media platforms are already starting to emerge.

Arweave plays host to some such platforms of the future. One such platform is Metaweave.xyz. Metaweave, formerly known as Argora, is a decentralized social media platform built on Arweave’s Permaweb. Anything posted to the program is permanent, and no one has the power to delete posts. The decentralization aspect of the platform means that, practically, it would never experience any downtime either.

Building a genuinely decentralized social media platform would allow for many user benefits. Read more on the thesis in our article “Blockchain’s Impact On Social Media And The Future Of Free Expression.”

Whether you are team Elon Musk, or team Parag Agrawal (current CEO of Twitter), the case may remain the same. Twitter and all other legacies Web2 social media platforms will always be served with one major problem: all carry a central point of control, decision making, and in turn, failure.

So what are your thoughts? Are you happy with the existing platforms we have? Or, are you an advocate of a decentralized social media platform? Or maybe, you are all about decentralizing everything known to humanity, not just social media…

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Az

Author and blockchain enthusiast.

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