Bankruptcy and layoffs have been the latest trend for crypto and tech companies and Twitter has not been left out. After being acquired by Tesla CEO Elon Musk for $44 billion there had been some prompt changes being made to the social media platform. A total of 3,700 positions were reportedly cut from the compnay two weeks ago, and as per reports last week, it seems the company may be having money troubles.
Musk Says Twitter Bankruptcy Is Possible
Following the massive layoffs from Twitter, there had been reports of people also quitting the company. Some of them were important executive employees who left seeing the state of things after the acquisition. Now, it looks like things on the social media platform are more troubled than they appear.
A Reuters report from Thursday said that Elon Musk had told employees of Twitter on a mass call that there was a possibility that the company could go bankrupt. It is no secret that Musk had paid way more than the social media giant was worth in the acquisitions, and he admitted that he wasn’t sure how much run rate the company had left.
The revelation shows why Musk had been aggressively pushing the Twitter Blue subscription model. At $8 a month, anyone can get verified on Twitter in what Musk says is a way to combat the bots. But the recent call shows it’s actually a way to boost revenue for Twitter.
AMC CEO Adam Aron told Yahoo Finance Live that making Twitter a success was in the best interest of Musk, so “it would be foolish of him to destroy it.” However, it seems even Musk is not confident of the longevity of the platform and its ability to generate enough revenue to keep running.
DOGE price at $0.087 | Source: DOGEUSD on TradingView.com
How Does This Affect DOGE?
The price of DOGE has shown a strong correlation to news coming out of Twitter over the last few weeks. Most of it had come from the expectation that Musk would eventually integrate DOGE, his favorite cryptocurrency, into the social media platform as a mode of payment, which remains a possibility.
However, this is only possible if the social media platform is able to weather the storm. In a company-wide email, Musk expressed concern about Twitter’s ability to “survive the upcoming economic downturn” unless there is an increase in subscription revenue from Twitter Blue to combat advertisers pulling away from the platform.
If the company were to go bankrupt, there is no doubt that it would negatively impact the price of Dogecoin. The meme coin is already succumbing to the current crypto winter and a collapse could push its price below $0.05 once more.
Twitter had previously shelved its plans to work on a crypto app for its platform. But on Nov. 4, Musk filed an application with the US Treasury Department Financial Crimes Enforcement Network (FinCEN) to register the company as a payments platform.
Featured image from Tearsheet, chart from TradingView.com
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Author: Best Owie