Text/Yan Chen
Edit/Anna
In 2022, the traffic is still given by Musk.
A few days ago, documents disclosed by the U.S. Securities and Exchange Commission (SEC) showed that Tesla founder Musk bought a 9.2% stake in Twitter, nearly 4 times more than Twitter founder Jack Dorsey's 2.25%. Musk, who was still criticizing Twitter half a month ago, has become Twitter's largest external shareholder.
However, several former U.S. securities regulatory officials and academics said Musk may have violated U.S. securities laws in the process. Under U.S. law, investors must inform the SEC when they hold more than 5% of a company's shares. Regulatory documents show that Musk met that standard on March 14, but he did not disclose it until April 4.
This "negligence" helped Musk earn an additional $156 million as Twitter stock soared, while the SEC's penalty for disclosure could be only about $100,000. As the newly appointed Twitter director, Musk has already "won" before the next board meeting.
And "Musk became the largest shareholder of Twitter" has also triggered heated discussions among netizens at home and abroad, and everyone is curious about what the real-life version of Iron Man will stir up on social networks.
Love it and buy it
Musk has long been a heavy user of Twitter. He has been using Twitter since 2009 and now has more than 80 million followers and has posted 17,339 tweets over a decade.
By analogy with Weibo, Musk can be regarded as a super big V in the Internet celebrity world, and his activity on Twitter is like a marketing number. According to statistics, Musk tweets an average of 3.7 per day. In May 2018, Musk's tweeting volume reached a record high, with 421 tweets issued in a month.
Musk's influence is not limited to public opinion, as a traffic creator, every tweet he tweets may affect Tesla's stock price, including the current Twitter stock price. In this sense, Musk is the first person to govern the company on Twitter.
In August 2018, Musk tweeted that "consider Tesla privatization," and Tesla shares rose more than 13 percent the next day. In May 2020, Musk tweeted again: "I think Tesla's stock price is too high", causing Tesla's market value to evaporate by more than $14 billion.
In March, Musk posted a vote on his personal Twitter tweet asking fans: "Do you think Twitter abides by the principle of 'freedom of speech'?" He also hinted: "This vote is quite important. Please vote for you carefully. Now it seems that this is Musk's preview of the entry into Twitter.
In fact, Musk's desire to become a shareholder in Twitter has been premeditated for a long time. SEC filings show that on Jan. 31, Musk bought 620,000 shares of Twitter for less than $36.83 a share. In the months since, Musk has been buying Twitter stock almost every day.
On the Twitter side, it is urgent for the market to give a positive signal. In recent years, Twitter's development has not been smooth, due to unsatisfactory product development, slow user growth and other issues, coupled with the impact of high valuations, investors are not good at Twitter stock. Twitter's 2021 Q4 financial report shows that although its losses have narrowed, it is still worse than market expectations, and its stock price has also fallen.
Musk's addition seems to be a shot in the arm for Twitter, which is entering a period of fatigue. After the SEC filing was disclosed, Twitter shares closed up 27.12% on Monday at $49.97 per share, the biggest intraday gain in more than four years, and even Tesla shares rose 5.61%.
Ignite social networks
Musk, despite being a big fan of Twitter, still has a lot of dissatisfaction with the platform, and he has publicly attacked Twitter's management for failing to live up to its promise of free speech. Jefferies analyst Brent Hill believes that one of the main motivations for Musk to join Twitter may be to influence its review policy.
In the Wall Street context, holding less than 10 percent is defined as "passive holding," i.e., not seeking control of the company, but the rule doesn't apply to Musk. Musk's latest 13D filing with the SEC shows that Musk is interested in actively participating in Twitter's various businesses.
The Twitter spokesperson stressed that Musk will not interfere in the daily operation of the company, but at present, Musk's right to speak about Twitter is different from that of ordinary shareholders, and in the future, he will influence Twitter's major decisions, including product strategy and business direction. Kathy Wood, founder of the Ark Fund, believes Musk's stake is enough for him to push Twitter to change management.
On the same day that the SEC filing was revealed, Musk launched a vote on Twitter: "Do you want an edit button?" Of the 4.4 million survey participants, 73.6 percent voted in favor. Twitter then clarified that "the editing feature has been being tested since last year, not because of a single vote," but before that, former Twitter CEO Jack Dorsey had said twitter might never roll out the editing feature. Musk's influence on Twitter is already beginning to show, and that's just the beginning.
It is foreseeable that this shareholding will not only increase Musk's influence on social media, become the best platform for his public relations activities, and even control the direction of social media itself and affect the entire public opinion field.
In addition, Musk has repeatedly expressed his support for Dogecoin, and the outside world speculates that Dogecoin will have more room to play on Twitter in the future.
After the news that Musk became Twitter's largest shareholder, On April 4-6, Dogecoin rose from a peak of $0.145 to $0.179, an increase of 23.4%. Dogecoin co-founder Billy Marcus said he intends to send at least one tweet a day with the #Doge Twitter Tip Jar# topic to attract the attention of the Twitter team, hoping that Twitter can support Dogecoin tipping.
Today, Musk's focus is still on Tesla and SpaceX, but his entry into Twitter also sends a signal that he is trying to build the social network he thinks he has in mind and influence the future of the Internet. As he previously hinted in a tweet: "Twitter's next board will be set on fire"