Twitter is set to begin paying verified content creators for ads in their replies. Company owner, Elon Musk, announced the first payment block of around $5 million, but only verified users will be eligible.
Struggle to Retain Advertisers
After purchasing Twitter last October, billionaire Musk has struggled to retain advertisers who have been wary about the placement of their ads following the company’s layoffs. However, Musk believes that advertisements that are more relevant and timely could raise Twitter’s earnings from 5 or 6 cents per hour of user attention to 15 cents or more.
Potential Regulatory Action
Twitter, alongside other online platforms such as Meta Platforms’ Instagram, Alphabet’s YouTube, and TikTok, could face regulatory action after European consumer group BEUC filed a complaint with the European Commission and consumer authorities. BEUC claims that the platforms facilitate the misleading promotion of crypto assets. Following the collapse of FTX and the US regulators suing crypto platforms Coinbase and Binance, concerns over consumer protection related to crypto assets such as Bitcoin and Ether have been raised. The European Union has recently adopted the world’s first comprehensive set of rules for cryptoasset regulation (MiCa).
Unfair Commercial Practice
BEUC argues that the proliferation of misleading advertisements of crypto assets on social media platforms is an unfair commercial practice as it exposes consumers to significant harm, such as the loss of money.
Twitter’s move to pay verified content creators for ads in their replies is an attempt to retain advertisers and increase earnings. However, the platform may face regulatory action due to the proliferation of misleading advertisements related to crypto assets. The European Union’s adoption of MiCa rules may signal the start of stricter regulation for these types of assets.
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