New twist in the “Elon Musk buys Twitter” series. The Tesla boss has suspended the takeover process due to the large number of fake accounts on the platform. How are these a threat and a scourge to the cryptocurrency ecosystem
Elon Musk suspends Twitter takeover
This Friday, May 13, Elon Musk announced the suspension of his plan to buy Twitter for $44 billion. Indeed, the CEO of Tesla announced that he was “awaiting details regarding the calculation that fake accounts and spam would actually represent less than 5% of users”
Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of usershttps://t.co/Y2t0QMuuyn
– Elon Musk (@elonmusk) May 13, 2022
As a direct result of this announcement, the company’s shares, listed on the New York Stock Exchange (NYSE), plummeted by more than 10% before the opening of the Wall Street trading session.
As a reminder, on 26 April, Elon Musk began the process of acquiring the company Twitter (TWTR) by buying all the shares in the company for 54.2 dollars per share. At the time, this represented a 38% capital gain for shareholders.
This news allowed the Dogecoin (DOGE) to rise by 40% within a few hours. A rise that seems far away today…
Why Elon Musk is interested in fake accounts
During the presentation of its quarterly results at the beginning of May, Twitter indicated that the social network has 229 million daily users and therefore monetizable. Of these, only 5% are fake accounts or bots.
Obviously, this information is crucial for Elon Musk in his calculation of the platform’s future revenues from advertising or paid subscriptions. However, despite the panic caused by this announcement, the Tesla CEO was keen to “reaffirm his commitment to the acquisition” of Twitter
Still committed to acquisition
– Elon Musk (@elonmusk) May 13, 2022
At the time of the announcement of the acquisition, the American entrepreneur had rightly mentioned his ambition to fight against fake accounts and bots that pollute the platform. At his level, Elon Musk is himself directly concerned by these accounts that usurp his identity to scam users
Why fake accounts are a scourge for cryptocurrencies
This phenomenon is particularly prevalent in the cryptocurrency space. With the explosion of decentralised finance (DeFi) and non-fungible tokens (NFTs), we have seen the emergence of many fake influencer accounts.
These accounts often have tens of thousands of followers (mostly bots) and are sometimes even certified by Twitter, which tends to reassure investors. However, they promote fraudulent projects whose sole objective is to scam users.
We would like to take this opportunity to remind you to always be vigilant and to do thorough research on each project before investing any of your capital in it
