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Twitter's potential as a Fintech app

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This week in fintech

November 8 · Issue #121 · View online

A weekly summary of the latest news in our world of finance, design, and technology.


Also:
  • 📆 The most common pay day in Norway
  • 🤯 Mindblowing finance fact
  • 🎨 Color and contrast

🤔 Twitter's potential as a Fintech app
I haven’t written a lot about the whole Elon buying Twitter debacle, mainly because there wasn’t a Fintech angle. But Bent Gjendem, CEO of Finance Innovation, made me aware that this is a possibility:
Elon Musk insists the deal is part of a master plan to launch an “everything app” incorporating messaging, payments, and commerce that has been more than two decades in the making according to Financial Times.
The idea of Twitter as a Fintech app is an interesting thought exercise. Let’s think through some different scenarios:
Model 1) Twitter tries to go after other fintech companies like Wise by incorporating cross-border payments. Let’s say you have NOK and want to send this to someone in the US who wants dollars. You could then send NOK to Twitter where it is converted to a digital currency for a few milliseconds before it is sent on to the recipient in USD. This could be doable, but I don’t see why people would turn to Twitter for this.
Model 2) Twitter tries to get into the payments business by becoming a payment platform for merchants. But why wouldn’t we just use Facebook/Apple/Google Pay instead? They are much larger and have more customers. Twitter could try to be a niche player in this space, but I don’t see a big market for that.
A side note here: Jack Dorsey, the former CEO of Twitter, ran a payment company, Block (formerly known as Square) at the same time as he ran Twitter. I guess there were good reasons for him to keep these companies separate.
Model 3) Twitter goes into crypto by providing a wallet to every user. You could buy Bitcoin and other cryptos and store them in a Twitter wallet. But why would you do that when you can store them on Coinbase or Binance instead? Twitter would have to offer some sort of incentive to use their wallet, and I don’t immediately see what that should be.
On the other hand, they could use the Reddits playbook to onboard millions to crypto without them knowing by providing a custody wallet connected to your account. If Twitter gives every user a wallet they would be 4 times larger than Coinbase when it comes to the number of users. This could also be a way to get rid of the bots since Twitter would have to provide a KYC solution for the new wallets.
Elon’s alleged idea is interesting, but the execution is going to be really difficult, and I don’t see how this is going to help Twitter expand its user base. After all, Twitter is very small compared to Facebook, Instagram, and Snapchat. But who knows? After all, Elon Musk comes from the PayPal mafia.
If you find potential business ideas for Twitter interesting I would also recommend reading the two-year-old blog post: “If I ruled the Tweets” by Packy McCormick.
📆 The most common pay day in Norway
If you’ve ever worked with a banking product targeted at the private market you often end up in the discussion of which day users get their paycheck. Luckily Nikolai Hope Møller, UX-lead at Bulder Bank, has revealed how this is distributed among their users:
Suddenly it is easier to talk about which dates to show when it comes to withdrawal dates for savings, mortgages and more!
🤯 Mindblowing finance fact
It’s not often I am mindblown, but when I read this statistic shared by Tom Staavi – Information director in Finance Norway, I once again got confirmation of why industry experience is important in Fintech:
The overall regulatory burden on banking and finance can be summarized in 15 000 pages.
In comparison, all of Harry Potter, Game of Thrones, and Lord of the Rings books combined are “only” ~ 9 000 pages…
The upside to this is control and stability. The downside is brilliantly illustrated in the book by my current favorite economist Thomas Phillipon who has written the book: The Great Reversal: How America Gave Up on Free Markets. Here he argues that, among other things, too extensive and detailed regulations increase the costs of regulatory compliance and pull in the direction of fewer and larger players. – Tom Staavi
🎨 Color and contrast
Nate Baldwin has created an impressively comprehensive guide for exploring and learning about the theory, science, and perception of color and contrast. It also specifically mentions how this affects UI design. You should check it out:
Color & Contrast Color & Contrast
That's it for this week 👋
Remember, if you’re enjoying this content, please tell all your (fintech) friends to hit the subscribe button! If you have some feedback, you can always just hit reply!
Marius Hauken, partner Stacc X
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