Elon Musk's X: Valuation Drops 55%, but Future Plans Hold Promise

Introduction

Elon Musk's X (formerly Twitter) has experienced a significant decrease in valuation. The company, which was purchased by Musk for $43 billion last year, is now valued at $19 billion. This represents a 55% decrease in value.

Valuation Details

Immediately after acquiring X, Musk took the company private, becoming the majority owner. At the time of purchase, the share price was $54.20. The new valuation of $19 billion is based on documents that outline the allocation of shares to current employees.

Employee Stock Equity

As part of X's compensation plans, employees are awarded stock equity. The value of the awarded stock is $45 per share. This model is similar to the vesting process in the crypto industry, where shares are earned over a 4-year period to prevent excessive devaluation.

Impact on Elon Musk and Investors

The significant devaluation of X reflects the current market turmoil and represents a substantial loss for Elon Musk and other top investors, including Binance's Changpeng 'CZ' Zhao.

Changes Made by Elon Musk

Since taking over X, Musk has implemented various changes to the company. This includes restructuring the corporate structure and monetization plans. Additionally, Musk has made subscriptions to X Premium mandatory for obtaining verification marks. Despite initial criticism, this move has increased X's popularity, particularly among users who benefit from the added features associated with verification badges.

Future Plans

Musk and the newly appointed CEO, Linda Yaccarino, have unveiled plans to transform X into a financial hub. The goal is to eliminate the need for a bank account within a year. This ambitious plan may also involve integrating non-custodial crypto wallets. These initiatives are expected to add value to X and contribute to its long-term valuation growth.

Conclusion

Elon Musk's X has experienced a significant decrease in valuation, dropping by 55%. However, Musk's strategic changes and future plans to transform X into a financial hub are expected to boost its value in the long term.