There is nothing like a high profile celebrity acquisition of a major social media platform to create volatility.
When Elon Musk ended all the speculation by purchasing Twitter for $44 billion recently, the price of the stock in the New York Stock Exchange-listed social media platform fell rapidly.
On April 12 this year, in the advent of Elon Musk's mega-deal, the stock declined to $44.48 per share, and then recovered. After the acquisition it depreciated again and then began to recover but has tailed off and become somewhat flat.
Amid the volatility in a stock that had been regarded for a long time as one of the steady big-tech giants which is never subject to much in the way of dramatic movement, Elon Musk's stature as a public figure had dominated the news as he made the purchase.
Former CEO Jack Dorsey stood down from his position at Twitter recently, sparking speculation that he may move toward other ventures including the digital asset and blockchain related business, as he has been positioning himself as Bitcoin's 'spiritual leader', a tag that is widely publicised in many financial markets news items recently.
Therefore, Twitter has become intertwined with the financial markets business, and its volatility is perhaps testimony to this.
Twitter stock closed last night in New York at $48.87 which is a small downturn over the previous day, however today there is an actual piece of news which may need to be taken into account.
New owner Elon Musk has inferred that Twitter may begin to charge a small fee for commercial users. In a tweet, he said “Twitter will always be free for casual users, but maybe a slight cost for commercial/government users." He then added “Some revenue is better than none!” in a later tweet.
Elon Musk plans to reform other ways in which Twitter is operated by approaching the subject of the remuneration packages of its executives and cut costs, as well as figure out monetisation methods.
He does, after all, have a series of investors and lenders to satisfy as he funded part of the $44 billion purchase with $21 billion of his own capital whilst the remainder was funded via a loan secured against his shareholding in Tesla and a series of other loans from banks.
If looked at in this regard, Twitter is a commercial entity in its own right for Elon Musk, and not just a method to give him a louder voice to influence markets such as cryptocurrency.
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