Listen to the Article: Musk's Plan to Build An Everything App Revealed As X Snatches Payment Licenses

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In a recent Fazzaco report​, following Elon Musk's rebranding of Twitter as "X," the company swiftly secured money transmission licenses across seven U.S. states within just a month. Elon Musk, the world's wealthiest individual, who made a staggering $43 billion investment to acquire Twitter, openly hinted at his aspiration to mold "X" into something reminiscent of PayPal during a recent gathering (it's noteworthy that PayPal's precursor was "X.com," an online financial services and email payment company founded by Musk in 1999). Yet, Musk's vision for the transformation of "X" appears to transcend the mere addition of payment functionality.

The Reach of Currency Licenses Issued Across Multiple U.S. States

The Nationwide Multistate Licensing System (NMLS) website reveals that "X" is registered under its subsidiary, Twitter Payments LLC, which holds licenses in seven states. To be specific, Arizona, Georgia, Maryland, Michigan, and New Hampshire have granted Money Transmitter Licenses, Missouri issued a Sale of Checks and Money Transmitter License, and Rhode Island bestowed a Currency Transmitter license.

For the majority of states, the scope of these licenses typically encompasses conventional operations. As an example, the Department of Insurance and Financial Institutions in Arizona defines a "money transmitter license" as follows: "This License is mandated for any company involved in selling or issuing payment instruments, receiving money for transmission, exchanging payment instruments, or accepting money for obligors with the intent to pay bills, invoices, or accounts."

The recent acquisition of a Rhode Island license by "X" underscores Musk's intent to craft an "Everything App". According to Rhode Island's "Money Transmitter Law FAQ," it explicitly notes that "Cryptocurrency wallets (and similar entities) squarely fit the definition of 'maintaining control of virtual currency' 'on behalf of others' when the business has custody of funds within the wallets."

This signifies that "X," through its Rhode Island license, is broadening its payment services from traditional fiat currency to encompass cryptocurrencies, aiming to offer custody and exchange services for cryptocurrencies and digital assets to its extensive global user base (currently confined to the United States).

The Significance of "X" Embracing Cryptocurrencies within Its Payment Services

In August this year, during a community discourse on whether "X" would venture into issuing a new cryptocurrency, Musk emphatically declared that "X" would never introduce any token. Many fervent Dogecoin supporters expressed their fervent desire to witness Dogecoin gaining widespread acceptance as a currency on the "X" platform.

Given the intricate ties between Musk and Dogecoin, the meme coin witnessed a notable 6% surge at the end of the previous month after "X" secured the Rhode Island license.

Now, with "X" integrating cryptocurrencies into its payment services, considering "X's" substantial scale (namely Twitter's), this undeniably carries substantial implications for the entire crypto community. Firstly, "X" will need to establish robust Anti-Money Laundering (AML), Know Your Customer (KYC), and anti-terrorism financing compliance mechanisms to safeguard user assets. This development augurs well for the fintech market.

Secondly, as "X" delves deeper into the crypto arena, it implies that a growing number of Web3 projects will come to fruition. Considering Musk's enduring role as an ardent tech advocate (venturing into the electric vehicle sector via Tesla, the aerospace domain through SpaceX, and now cryptocurrency payments through "X"), Musk may genuinely integrate Dogecoin into "X's" payment ecosystem, thereby potentially reshaping the landscape of the crypto industry.

What Lies Ahead for X?

As previously stated, "X" obtaining payment licenses across seven states within just a month is merely the opening gambit. Acquiring a Rhode Island license serves as but a stepping stone into the realm of crypto. Consequently, we can anticipate (and almost certainly will witness) "X" securing additional state licenses down the road. Additionally, if "X" intends to establish a substantial crypto operation, it will need to apply for an Electronic Money Institution (EMI) license in Europe.

Furthermore, to realize Musk's ambitious vision for the "Everything App," "X" will need to conduct exhaustive risk assessments and testing to ensure a seamless transition, thus avoiding a situation akin to Mark Zuckerberg's rebranding of Facebook as "Meta" to enter the metaverse field, which was met with mixed reception in the market.