Crypto-proximal – Elon Musk falling to planet Earth with a sickening thud

Last week, after the hammer attack on Nancy Pelosi’s husband Paul at his home, Elon Musk retweeted a column from a notoriously scammy Los Angeles-based website that implied maybe this was a gay prostitute encounter gone wrong. He eventually retracted the tweet, but the damage was done.

Advertisers are fleeing Twitter, an exodus that had actually started before the Pelosi incident.

As soon as it was apparent that users’ anti-Semitic and racist tweets (including liberal use of the n-word) were not being censored (perhaps emboldened by Musk’s “free speech maximalist” opinions), the whooshing sound of advertisers running out of the door could be heard. Up to 30%, by some accounts, including whales like General Mills, Audi, Volkswagen, Pfizer, General Motors.

Thirty percent of advertising revenue disappearing in such a short time can only be described as sickening, especially if you are an investor. For others, it may sound like the bells of karma.

Obviously, there is the question of why big corporate advertisers, not generally known for unimpeachable moral compasses, are choosing to look elsewhere. The answer is simple – most users are not bigots, notwithstanding what the edges of social media would like us to tell us. And no one wants their ads to appear next to a tweet comparing some ethnic or religious group to cockroaches. The optics would be a little embarrassing.

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It gets worse for our erstwhile admired countryman. Reports of his behaviour as a manager are now surfacing all over the place. Sudden and unbidden outbursts of apoplectic puce-faced fury, on-the-spot firings, belittling of underlings. One ex-manager likened it to becoming “possessed”. (It sounds just like a boss I once had, who confused cruelty, insult and the meting out of fear with leadership.)



And then there is the whole blue-tick debacle. One can pay money to get a “blue tick” against your profile, meaning that, as a user/tweeter, you have been properly vetted and authenticated and so can be trusted not to be a bot or troll. The going price is $8 per month.

This achieves two things – a user hierarchy and the exclusion of many users in countries for whom $8 per month is not completely trivial.

And let’s not forget about more than 3,000 staff terminations in a little more than a week, a full 50% of Twitter workforce. It is probably safe to assume that this was done in haste and without any grace, and that many lives were upended.

Ad revenue collapse, subscription revenue disappointment, an angry media and users and ex-employees looking to see where else they might find kinder and gentler home. It is not hard to see where this might end.

Where are the current users (including me) looking? Some people are trying LinkedIn, but that’s not really the same, is it? Others have poked their noses into Lens, a blockchain-social media effort from the team behind the Defi crypto giant Aave, but the jury is still out on that. Perhaps they will be a beneficiary of all of this.

But the big excitement is about Bluesky Social, developed by none other than the creator of Twitter, Jack Dorsey, still in pre-beta mode. Not too much information is available (you can see early tantalising stuff here), but is clear some deep thinking as gone into the underlying architecture, called the AT protocol, which is promising to wrench social media away from the world of corporate ownership and into the hands of its users.

If this rhymes with the entire philosophy behind the crypto industry, it is no coincidence. Dorsey is a long-time champion of Bitcoin, and while it is rumoured that Bluesky Social is not (yet) on a blockchain, it is sure to be friendly to the spreading world of crypto applications.

This looks all very Shakespearean, even biblical. Elon Musk, a foreign outsider to the cloistered world of California hi-tech entrepreneurs slays many a Goliath on his way to singlehandedly inventing the electric vehicle market and the private space exploration market and becoming the richest man in the world in the process. Along the way he becomes convinced his knowledge and skill and insight are unbounded. Godlike. No matter where he treads. An old story of self-deceit.

And then he mounts the horse of vaulting ambition. And falls off with a sickening thud. DM

Steven Boykey Sidley is Professor of Practice at Johannesburg Business School at the University of Johannesburg.