Musk accelerates the development of X "super app", the financial service tools under it will soon be launched.

After more than three years of acquiring Twitter, Elon Musk recently stated that his long-term goal -- to turn this platform into an "super app" -- is nearing realization. He plans to launch a new financial services tool this month and has made a public commitment to it. This platform, named "X Money," a bank and payment platform will be integrated into the renamed social platform X. According to Musk's timetable revealed last month, the tool will soon be open to the public for early access. Early users participating in the testing have praised its competitive services, including 3% cashback for eligible purchases and an annualized yield of up to 6% for cash savings accounts -- around 15 times the national average. According to users who have early access, Musk's new product will also provide free peer-to-peer transfer services, a Visa metal debit card engraved with the user's X account nickname, and an artificial intelligence (AI) assistant created by Musk's xAI startup company, which can track spending records and categorize historical transactions. Musk first made a name for himself in Silicon Valley by co-founding PayPal Holdings Inc. He views payment functions as a key element in creating social products similar to the thriving "super apps" in China, such as WeChat, where users can hail rides, book flights, and pay credit card bills through the app. As Musk said to employees in February this year, "We want to make it so that you can do just about anything on the X app if you want to." If X Money successfully lands, it will pioneer a large-scale attempt in the United States to deeply integrate social media with finance. However, the super app model has not yet gained wide popularity in the United States. Several key details about Musk's payment project remain unclear, such as pricing, a complete list of features, and the specific date for full launch. Musk is known for setting high-profile goals and frequently delaying fulfillment. This time, he faces regulatory troubles and delays: X Money has not yet obtained payment licenses in multiple states, including New York, where legislators have raised questions about trusting this billionaire to manage public funds. There is also uncertainty regarding consumer rewards. Although X Money's potential 6% savings rate exceeds those of competitors like SoFi Technologies Inc., Block Inc., and LendingClub Corp., Musk's company has not clarified whether this rate is permanent or promotional. A spokesperson for X Company did not respond to requests for comment. Richard Crone, founder of Crone Consulting LLC and industry observer with a long history in the payment industry, has expressed doubts about the prospects of X Money. "He made this promise more than two years ago, saying it would be achievable within a year," Crone said. "It seems it's too little, too late now." Missing Features and Implementation Challenges In the fintech industry, Musk indeed has many inherent advantages that most peers in the industry cannot match: a platform with 600 million monthly active users; a group of loyal content creators already earning income on X; and his own history of creating pioneering payment services. According to early users, users currently receiving creator income through X will have their settlement channels switch from Stripe to X Money -- a move that ensures a solid foundation for initial active accounts. Some users participating in testing have already begun sending payments to each other through X's chat feature or directly through their profile pages. However, it remains unclear how X Money accounts will be handled if a user's X account is blocked or suspended. Harshita Rawat, a senior research analyst at Bernstein Institutional Services LLC, noted that while peer-to-peer payments are popular in everyday use, they are often a loss-making business for companies that provide such services. The real value lies in being able to convince users to conduct the rest of their banking business, including credit card spending and loans, on the same platform in order to profit. "Becoming the primary banking account for a user is very challenging," Rawat said. "I'm not saying it's impossible, but you need to find a practical entry point for it." Some veterans in the payment industry believe there is a more fundamental issue: X still lacks the underlying infrastructure to make the shopping experience on the platform frictionless, which is essential for any application intending to handle real e-commerce business. "He doesn't have a one-click purchase feature, and to develop e-commerce, this feature is essential; otherwise, his platform will lag behind in e-commerce," Crone said. Due to regulatory obstacles, Musk's project timeline has been delayed multiple times. Operating a payment platform in the United States requires licenses from all 50 states, and Musk underestimated the complexity of this process. In a full staff meeting in 2023, he predicted that X would receive the necessary approvals "in the coming months." According to information on the X website, the company currently holds licenses in 44 states, and it is likely unable to operate in states where licenses have not been obtained. Last year, then-New York State Senator Brad Hoylman Sigal and Assemblymember Micah Lasher wrote to the New York State Department of Financial Services urging them to reject Musk's license application. They cited Musk's "reckless patterns of behavior in business and government, putting consumers at risk," including his involvement in efforts to dismantle the Consumer Financial Protection Bureau during his time leading the Office of Management and Budget. Documents and emails obtained through public records requests show that state regulatory agencies also requested detailed explanations of X's business model and security features, with X Company's lawyers sometimes having to respond to multiple rounds of follow-up questions. In at least one case, regulatory agencies expressed concern about Musk's earlier record at X -- where he made significant layoffs, including many employees responsible for security matters. Emails show that a payment regulator in Texas, during a review of X's application in June 2024, sought the opinions of other states and raised "several concerns" about X's application. Specifically, the regulator wanted to discuss the "historical issues between Musk and the U.S. Securities and Exchange Commission" and the "financial condition of X Payments LLC's parent company X Corp." This request led to a multi-state conference call in the summer of 2024. Texas approved X's application three months later. Earlier in April this year, Massachusetts Senator Elizabeth Warren, who has been a vocal critic of Musk, wrote to Musk raising questions about the economic feasibility of X Money's yield rates and its banking partnership arrangements, expressing concerns about the broader impact this project may have on the financial system. "You have not operated X in a safe and responsible manner, which does not inspire confidence in your ability to safely expand into consumer finance," she wrote. X is currently awaiting a payment license from Massachusetts.