Elon Musk’s takeover of Twitter suspended due to fake accounts

Elon Musk halts Twitter takeover

This Friday, May 13, Elon Musk announced the suspension of its plan to buy Twitter for $44 billion. In effect, the CEO of Tesla announced to be “awaiting details regarding the calculation that fake accounts and spam actually represent less than 5% of users”.

As a direct result of this announcement, the company’s stock, listed on the New York Stock Exchange (NYSE), plummeted more than 10% before the opening of the Wall Street trading session.

As a reminder, on April 26, Elon Musk had started a procedure for the acquisition of the company Twitter (TWTR) buying back all of the company’s shares for $54.2 per share. This constituted, at the material time, a capital gain of 38% for shareholders.

A news that had also allowed to Dogecoin (DOGE) to climb by 40% within a few hours. An increase that seems very distant today…

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Why is Elon Musk interested in fake accounts?

When reporting its quarterly results in early May, Twitter reported that the social network has 229 million users daily and therefore monetizable. Among them, only 5% would be fake accounts or robots.

Obviously, this information is essential for Elon Musk in its calculation of future revenues from the platform through advertising or paid subscriptions. However, despite the wave of panic caused by this announcement, the CEO of Tesla held “to reaffirm its commitment to the acquisition” from Twitter.

At the time of the announcement of the takeover, the American entrepreneur had rightly mentioned his ambition to fight against fake accounts and robots that pollute the platform. On his scale, Elon Musk is himself directly concerned by these accounts who usurp his identity to scam users.

Why fake accounts are a plague for cryptocurrencies?

This phenomenon is particularly present in the field of cryptocurrencies. With the explosion of decentralized finance (DeFi) and non-fungible tokens (NFTs), we have seen the emergence of many fake influencer accounts.

These often display several tens of thousands of subscribers (mostly robots) 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 therefore take this opportunity to remind you to always be vigilant and of do in-depth research on each project before investing part of your capital in it.

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About the Author : Lilian Aliaga

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Freelance writer located between Paris and Toulouse. I want to share my passion for the world of cryptocurrencies to as many people as possible. I am also interested in technical analysis and trading.
All articles by Lilian Aliaga.

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