Binance will also assist Twitter’s integration into Web3 by implementing crypto payments and deploying a dedicated team of on-chain specialists to stop spam bot accounts.
Binance CEO Changpeng “CZ” Zhao has explained the reasoning behind its $500 million co-investment into Elon Musk’s Twitter, citing monetization potential, crypto community free speech, and the opportunity to eventually “help bring Twitter into Web3.”
CZ’s comments came from an Oct. 31 CNBC Squawk Box segment, where he explained what drove his co-investment with Elon Musk to acquire the social media platform noting:
“I believe Twitter has not been monetized well, it has not grown well, there’s many tactical problems like bots that spam my comments, there’s scammer accounts on there, it’s not been run well.”
“But I think the platform has huge value in itself, and especially now with Elon at the helm, we’re very confident,” he added.
Binance has not wavered in its support for Musk’s acquisition of Twitter since it first announced its support in May 2022. Other co-investors include Sequoia Capital Fund, Fidelity Management and Research Company.
The Binance CEO said Twitter’s difficult price valuation didn’t impact its investment decision as they considered the long term prospects to be strong, while giving crypto a “seat at the table” when it comes to free speech:
“We’re long-term investors, we believe in strong entrepreneurs, we believe in strong platforms, we believe in free speech […] we look at this from a 10, 20, 50, 100-year basis, so a little price fluctuation on a monthly basis doesn’t bother us.”
However, decisions as to what Twitter accounts are re-activated won’t lie in the hands of Musk, who said that a new “content moderation council” will bear the duty to determine what banned user accounts are restored.
However, the billionaire entrepreneur confirmed in a tweet that the council will exercise its discretion with “widely diverse viewpoints.”
CZ says it invested as it also hopes to play a part in Twitter’s eventual transition to Web3, such as adding cryptocurrency-based payments on to the social media platform.
“We want to help solve those immediate problems like charging for memberships [….] that can be done very easily by using cryptocurrencies as a means of payment.”
According to a Reuters report on Oct. 28, the crypto exchange plans to create a dedicated team to work on potential crypto and blockchain-based solutions for Twitter.
The new team will explore how to build on-chain solutions to address issues such as spam bot accounts.
Related: Twitter’s top brass gutted as Elon Musk’s takeover begins
Binance’s $500 million investment into Twitter makes them the fourth-largest shareholder in the social media platform amongst 19 investors.
Twitter is also no longer a publicly-traded company, having been delisted from the New York Stock Exchange (NSYE) on Oct. 28, following Musk’s decision to take the company private.