Vitalik Buterin backs Elon Musk’s Twitter takeover

The Ethereum cofounder Vitalik Buterin has expressed support for Elon Musk’s takeover of Twitter, but questioned the overall positive impact of media platforms coming under billionaire ownership.

Don’t oppose Elon running twitter (at least compared to status quo), but I do disagree with the more generalized enthusiasm for wealthy people/orgs hostile-takeovering social media firms. That could easily go *very* wrong (eg. imagine an ethically-challenged foreign gov doing it) https://t.co/LDqjXh3xCK

— vitalik.eth (@VitalikButerin) April 15, 2022

According to Buterin, hostile takeovers with low barriers can discipline management. But this may not work for the media, especially social networks. They wield a very high degree of influence, but often have low monetization and relatively modest market capitalization, making them targets for such deals.

The problem is particularly bad in the social media case because media platforms combine very high levels of influence with often low monetizability (and so low market cap -> cheap to acquire)

— vitalik.eth (@VitalikButerin) April 15, 2022

Buterin proposed imagining a scenario in which Saudi Arabia’s heir apparent Al-Waleed bin Talal increases his stake in Twitter from 5% to 50%. In this case, the country’s leader with “ethical concerns” would gain far more influence over the platform’s policy than the rise in his stake in the company, said the Ethereum cofounder.

The «but that Saudi guy already owns 5%» point is well taken but ultimately weak imo. Control is superlinear in ownership stake. His level of ability to control policy is very low now, and would increase by *far* more than 10x if his ownership increased to 50%.

— vitalik.eth (@VitalikButerin) April 16, 2022

Buterin argues that Twitter provides a public utility. The platform should not be controlled by authorities.

I personally consider twitter to be a public utility, but where there are lots of very good reasons why that «public» should not be represented by any specific government. Hence the challenge…

— vitalik.eth (@VitalikButerin) April 15, 2022

The Ethereum cofounder was supported by Twitter founder Jack Dorsey.

same

— jack⚡️ (@jack) April 16, 2022

Binance CEO Changpeng Zhao suggested that the board’s poison pill may not align with investors’ interests.

This is how capitalism works, right? The «poison pill» on the other hand, sounds unfair. The board seems to be protecting itself (power/control) over the interests of all the investors. Anyway, I am sure there is more than what’s on the surface.

— CZ 🔶 Binance (@cz_binance) April 16, 2022

The board-approved plan позволяет акционерам покупать дополнительные акции со скидкой в случае приобретения любой организацией или физлицом от 15% ценных бумаг Twitter без одобрения советом директоров.

Earlier, Musk became the company’s largest shareholder after acquiring 9.2% of shares for $2.89 billion. He proposed lowering the price of Twitter Blue and adding payments in Dogecoin (DOGE).

On April 14, Musk proposed buying Twitter for more than $43 billion. He explained this as an intention to create an “inclusive arena for freedom of speech”, rather than a money-making venture.

Subscribe to ForkLog news on Telegram: ForkLog Feed — all the news feed, ForkLog — the most important news, infographics and opinions