Changpeng Zhao, the chief executive of Binance, who is also known as ‘CZ’ elaborated on the reasons behind the crypto exchange’s co-investment of $500 million in the acquisition of Twitter by Elon Musk.
The CEO of the largest crypto exchange in the world said that free speech for the crypto community, the potential of monetization, and the opportunity of eventually integrating Twitter into Web3 were the motivations behind the move.
Elon Musk recently made headlines when he finally completed his acquisition of the social media platform, Twitter.
Amongst the various people and companies involved in the investment, one was crypto exchange Binance which contributed $500 million to the said deal.
On October 31st, the Binance chief exec appeared on CNBC Squawk Box and explained what had prompted him to co-invest with the Tesla CEO in his Twitter acquisition.
CZ said that he believed that Twitter has not been properly monetized and has not grown well either. He said that there were a lot of tactical problems like scammer accounts and bots spamming.
This means that the platform has not been run well, even though it can offer a huge value. He said that they were confident of the value Twitter can offer, now that Musk is leading the ship.
The acquisition of Twitter by Elon Musk first surfaced back in May this year and Binance had been in full support of it from the beginning.
The crypto exchange has not shifted its stance and it proved its commitment by making the $500 million investment. Other investors include Fidelity Management and Research Company and Sequoia Capital Fund.
The CEO of Binance said that the difficult price valuation of Twitter did not have any impact on the investment decision because they believe it has strong long-term prospects.
This is in reference to the seat it can offer when it comes to free speech on crypto. Zhao said that they are long-term investors who believe in strong entrepreneurs and platforms.
He added that they also believe in free speech and are not bothered by a little bit of price fluctuation every month.
It should be noted that Musk will not decide which Twitter accounts will be re-activated, as the billionaire investor said that a ‘content moderation council’ will decide which accounts to restore and which ones to ban.
But, he did confirm in a tweet that the council will consider widely diverse viewpoints when making its decisions.
According to CZ, they had also decided to go ahead with the Twitter investment because they want to play a role in the platform’s eventual transition to Web3. These include the addition of crypto-based payments on the platform.
A report published on October 28th said that Binance was planning on setting up a dedicated team for developing potential blockchain-based and crypto solutions for Twitter.
The said team will work on developing on-chain solutions to deal with issues like the spam bot accounts that exist on Twitter.