How Would Micro-Payments Work in the Twitter Ecosystem?
So, how would it work? Twitter would first need to get licenses in certain jurisdictions, the United States, Canada, the EU (the EEA), the UK, Australia, New Zealand, Singapore, Hong Kong, Japan, South Korea, the GCC, etc.
In my opinion, Twitter should start with Fiat, not crypto. Why? Because it is the most straightforward and lowest-hanging fruit with the least amount of objections in terms of licensing, regulations, etc.
Some pundits are saying Twitter should introduce DOGE in their payments ecosystem. I disagree with that because the regulatory and compliance hurdles are immense when you introduce cryptocurrency, especially on the first go, and that too on one of the world’s largest social media systems (Remember what happened to Facebook and their Libra project?).
Why would you want to skip eight steps, go for crypto immediately, and invite unwanted scrutiny?
Go the Fiat route. It’s already there; it is what everyone understands; it transcends all boundaries, is compliant, and, most importantly, is easy to implement. You want to start with the simplest, the lowest-hanging fruit that would cause the least amount of objection, which in this case would be the Fiat.
It’s my first recommended step. I think Twitter would and should introduce small value and micropayments in their ecosystem.
The next step would be to onboard users in the payment ecosystem. For example, how do you get a customer on board in the United States? Well, if you have a Twitter account, you can verify it through a blue tick. A blue tick or a verified account means you’ve been KYC’ed based on your bank account that is also in your name, you’ve provided some form of identification, etc. You can use that same KYC’ed account, debit card, or bank account to load funds onto the Twitter Wallet.
So now, every verified Twitter account also becomes a Twitter wallet, and based on the amount of KYC information you supplied, that is the limit of your wallet.
Now that you have already been KYC’ed by the banking institution with which you have an account, Twitter is trusting the system that the KYC’ed account as used by a Visa, MasterCard, or your bank account is good enough for themselves to be able to provide you and a wallet on their system.
This can be done in the US, the EEA, the UK, and other countries that can also follow suit. For example, if you’re a user from Greece. You could sign up with Twitter Europe, open an account, and use a Greece-issued bank card to load funds with a limit. The limits could be in slabs. The 90-day limit could be $100, the 30-day limit could be $25, the 60-day limit could be $50, and so on and so forth. This allows Twitter to control the amount of money flowing through KYC’ed bank accounts and debit cards into their payment ecosystem, keeping them safe from terrorism financing and money laundering threats.
Content creators will suddenly have a new revenue stream in all shapes or forms that they have not seen before.
They will not have to rely on third-party payment systems or offload the payment mechanics outside the Twitter ecosystem. It’ll be natively built-in. You can send money to any Twitter account you wish.
Regarding the cost of moving funds from, let’s say, Twitter account A to Twitter account B, it’s simply an internal transfer, a simple ledger entry. There’s no bank involved as such, it’s just a balance entry, a record of truth entry. So as far as Twitter itself is concerned, the balances move from Pat to John, or from Mary to Ali, and so forth. So this is a huge, huge benefit because it brings a lot of revenue that will stay in the Twitter ecosystem. And I think this would be the right approach.
With additional client balances and the sheer size of Twitter, it can eventually offer other financial services. Think of a Twitter-branded VISA/Mastercard being able to issue virtual cards, etc.
Elon Musk is looking in the right direction regarding the platform’s monetization. Let’s see how it pans out in the coming months.
In my opinion, this would be the most natural progression because it would allow, for the first time, a very large-scale social media presence on the Internet, which they already do but with the added functionality of payments.
