X payment system ‘X Money’ to launch in 2025, CEO Linda Yaccarino says.

Here’s a more detailed look at the planned ‘X Money’ payment system set to launch in 2025 by X under the leadership of CEO Linda Yaccarino:

Overview:

• Name: ‘X Money’
• Launch Date: Planned for 2025
• Objective: To transform X into an “everything app” by integrating comprehensive financial services directly within the platform. This includes turning X into a functional bank account where users can store money, send payments, and manage their financial activities without needing external services like Venmo or traditional banks.

Features and Functionality:

• Digital Wallet: Users will have an in-app wallet where they can store money. This wallet is intended to function similarly to services like Venmo, allowing for peer-to-peer money transfers among X users.
• Earning Interest: There’s a plan to allow users to earn interest on the money held in their X Wallet, similar to a savings account.
• Payments for Goods and Services: Users will be able to use X Money to purchase goods and services directly from vendors or creators within the X platform. This could extend to buying physical items, tipping creators, or even making payments in retail stores.
• Integration with Physical Stores: The vision extends to using X Money for transactions in physical stores, aiming to compete with services like Apple Pay.
• Comprehensive Financial Ecosystem: The ultimate goal, as articulated by Christopher Stanley, X’s Security Engineer, is to create a system where users have no incentive to take money out of X’s ecosystem, offering all financial needs within the platform. This includes the possibility of gaining interest, buying products, and using the service for everyday transactions without leaving the app.

Regulatory and Technical Preparations:

• Licensing: X has been actively securing money transmitter licenses across various U.S. states, with reports indicating licenses in at least 25 states by April 2024. This is crucial for operating a payment service legally within each state.
• Crypto Integration: While initial offerings will focus on fiat currency, there has been mention of future flexibility to integrate cryptocurrencies, though no definitive plans have been confirmed. Elon Musk has indicated a cautious approach to cryptocurrency integration, noting he spends “hardly any time” thinking about it, but the infrastructure could be designed to support it eventually.

Strategic Importance:

• Diversification of Revenue: With challenges in ad revenue, the payment feature represents a significant opportunity to diversify X’s income streams, potentially making it less dependent on advertising.
• User Engagement: By offering financial services, X aims to increase user engagement, retention, and the average time spent on the platform, turning it into a daily utility for users.

Challenges and Considerations:

• Regulatory Compliance: Each state in the U.S. has its own set of regulations for money transmission, which X must navigate. This includes ongoing compliance with anti-money laundering (AML) and know-your-customer (KYC) regulations.
• User Adoption: While the vision is ambitious, user adoption will be key. Users must see the value in consolidating their financial activities within X, especially given established competitors in the payment and banking space.

This development marks a significant expansion of X’s capabilities, aligning with Elon Musk’s long-term vision since acquiring the platform, to make it a central hub for not just communication but financial transactions and management.