X, formerly known as Twitter, has successfully obtained a 7th currency transmitter licenses (CTL) in the United States as it steps up efforts to create a payments network.
In the United States, a Currency Transmitter License (CTL) is said to be generally mandatory for companies such as cryptocurrency exchanges, digital wallet providers, and payment processors. This license ensures that these businesses operate in accordance with relevant regulations, including adhering to anti-money laundering (AML) and know-your-customer (KYC) procedures. The aim is to prevent unlawful financial activities from occurring.
According to information available on the Nationwide Multistate Licensing System (NMLS) for the United States, X was granted the Rhode Island Currency Transmitter License in August 2023.
Reports further indicate that a forthcoming payments feature from X is anticipated to initially provide support for fiat currencies. However, it has been suggested that Elon Musk has instructed X’s developers to design the platform’s payment system in a manner that permits the integration of cryptocurrency functionality at a later stage.
This approval follows closely after X obtained money transmitter licenses in Michigan, Missouri, and New Hampshire, all of which were granted in July 2023. With the recent approval for the Rhode Island Currency Transmitter License, X has now secured licenses in a total of seven American states.
Insiders familiar with X’s strategies have suggested that the company’s initial offerings will resemble fiat currency transaction services akin to PayPal, a company co-founded by Elon Musk. These services are designed with the potential for future integration of cryptocurrency functionality.
In 2021, Twitter introduced TipJar, a payments tip option for Bitcoin. With the feature, users are able to make tips in fiat to other people, such as creators, using third party financial services like Square, Venmo, and bitcoin.
Twitter’s bitcoin payments using TipJar were facilitated by the Lightning Network, a bitcoin layer 2 parallel chain that makes transactions a lot cheaper and quicker compared to mainnet transactions.
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