Twitter monetization and free speech drove Binance’s $500M injection: CZ

Binance CEO Changpeng “CZ” Zhao explained the reasoning behind his $500 million co-investment in Elon Musk’s Twitter, citing monetization potential, freedom of expression for the crypto community, and opportunity to eventually “help bring Twitter into Web3”.

CZ’s comments come from an Oct. 31 CNBC Squawk Box segment, where he explained what prompted his co-investment with Elon Musk to acquire the social media platform, noting:

“I believe Twitter hasn’t been well monetized, it hasn’t grown well, there are a lot of tactical issues like bots spamming my comments, there are scam accounts there, it’s not was not handled well.”

“But I think the platform has huge value on its own, 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.

Binance CEO said Twitter’s tough price assessment didn’t impact his investment decision as they see the long-term outlook as strong, while giving crypto a “place at the table” in terms of freedom of expression:

“We are long-term investors, we believe in strong entrepreneurs, we believe in strong platforms, we believe in free speech […] we look at this on a 10, 20, 50, 100 year basis, so a small price fluctuation on a monthly basis doesn’t bother us.”

However, decisions about which Twitter accounts to reactivate will not be in the hands of Musk, who said that a new “content moderation board” will have the duty to determine which banned user accounts will be restored.

However, the billionaire entrepreneur confirmed in a tweet that the board will exercise its discretion with “very diverse viewpoints”.

CZ says he invested because he also hopes to play a role in Twitter’s eventual transition to Web3, such as adding cryptocurrency-based payments to the social media platform.

“We want to help solve those immediate issues like membership billing [….] this can be done very easily using cryptocurrencies as a means of payment.

According to an October 28 report from Reuters, 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 create on-chain solutions to problems such as bot spam accounts.

Related: Twitter’s top brass have been gutted as Elon Musk’s takeover begins

Binance’s $500 million investment in Twitter makes it the social media platform’s fourth-largest shareholder among 19 investors.

Twitter is also no longer a publicly traded company, having been delisted from the New York Stock Exchange (NSYE) on October 28, following Musk’s decision to take the company private.

Christy J. Olson