Over the last few years, we heard that X is bringing payments to its platform. The company has been filing for money transmittal licenses in the various states. To date, they have over 45 of them.
Elon Musk announced that X money is coming to the platform very soon. It will be rolled out in very limited beta. Due to the nature of the service along with the security concerns, this could be a rather slow rollout.
The service is in partnership with Visa, which will allow connection to bank accounts through debit cards.
With all the discussion about crypto, many are wondering when that will be incorporated.
X Money Coming Soon - Crypto To Follow?
The goal of X is to be the "everything app". It is modeled after the Chinese application, WeChat, which provides a wide variety of services, including financial.
What this means is building a digital wallet system which is tied to users accounts. This would allow for payments to occur on the platform, with the link, through Visa, to individual's bank accounts.
Ultimately, the goal is to create a strong marketplace.
But what about crypto?
Elon is known for his trolling regarding DOGE coin. This has many within the crypto community believing he will integrate that into X.
While this is certainly possible, I find it unlikely. If DOGE or any other coin like BTC is incorporated, it will be as part of a swapping platform. DOGE, like other crypto-assets, doesn't serve as a strong medium of exchange.
That does not mean that crypto payments will not be built in at some point. In fact, it would only make sense for X, like other platforms, to get involved.
Here we harken back to stablecoins. We are still awaiting US legislation which will provide clarity. That said, we can take a look at how things are shaping up to get an idea of what will happen.
The simplest is that X could eventually integrate stablecoins as means of payment. Something like USDC or USDT could be utilized simply by offering crypto wallet connection.
XUSD
Another option for X could be the issuance of its own stablecoin. For the sake of this article, let's call it XUSD.
In an ironic twist, if the legislation does not change, Elon Musk will be able to issue out a stablecoin whereas Meta, Google, and Apple will be prohibited.
Part of the GENIUS Act is that companies which have a primary business that is not financial cannot issue a stablecoin without going through a committee. What the parameters are to get approval is unclear.
Where Musk benefits is this only applies to publicly traded companies. X is private. That means that Tesla is barred from rolling one out but X, SpaceX, or Neuralink are free to do so.
Obviously, the one that makes the most sense is X.
Under this scenario, if the bill does not change, X could create a stablecoin, have the dollars entering used to back the coin, and let people interact on the platform using XUSD. It could basically eliminate USD as the means of payment. All "dollars" on the application would be XUSD, with conversion occurring as the money enters or exits the platform.
X has somewhere around 600 million users. This means that having a stablecoin of $10 billion is not outrageous.
The 1 month T-bill is presently paying over 4%. This is a healthy return for simply offering $1 of payment value for each dollar placed on the platform. Of course, there will be other fees that are charged on top of this, similar to PayPal.
Tether presently have $152B of the $250 billion stablecoin market cap. If a platform such as X decided to enter that realm, this position could be under threat.
If the 80% are in US treasuries, this would be an annual payout of $5.10 billion.
To a platform like X, this would be "found" money.