X Money, Elon Musk's challenge

The day Musk’s email landed at PayPal

For fifteen years I worked at PayPal, and among the many episodes I remember, one comes back to mind every time I hear about Elon Musk and payments. It was one of the earliest years of my career there. I found myself on the distribution list of an email signed by him, even though he had left the company long before, asking for the return of the X.com domain, the idea he had founded and then let go. I asked my manager what it was about and what I was supposed to do. The answer was the one you’d expect in these cases: someone much higher up would handle it. The domain did go back to him, it was 2017, and for years that story stayed with me as a curious anecdote to tell every now and then. I could never have imagined what that piece of the internet would become once turned into X, and now into a platform that wants to handle our bank accounts too.

From X.com to PayPal, a circle closes

The story deserves a step back. X.com was born in 1999 as Musk’s financial startup, merged with Confinity, the company behind PayPal, and within a few years the stronger brand, the one tied to online payments, took over. Musk was pushed out of the company’s leadership as early as 2000, long before eBay acquired the payments giant. The domain sat orphaned for almost two decades, until he decided to take it back. With X Money, the circle closes: the man who imagined a financial “everything app” back in the late nineties is now trying to build it inside the social network he renamed X.

How X Money works

The service lets users send and receive money in real time, pay bills, and make transfers directly from the app. Anyone who opens an account with at least a thousand dollars can earn up to 6% annual yield, a figure that outpaces classic American savings accounts, plus 3% cashback on eligible purchases, excluding gambling and cryptocurrency. There’s also a Visa card, virtual or physical in metal, usable with Apple Pay, with free ATM withdrawals worldwide and no fees on international transactions. Behind the scenes, X doesn’t hold a banking license of its own: the infrastructure runs on Cross River Bank, a common workaround among fintechs to avoid the long wait for an independent charter. Deposits still carry federal insurance coverage up to $250,000. For now the service is limited to adult Premium and Premium+ subscribers in the United States, with the exception of New York and Massachusetts, where it isn’t available yet.

An app that wants to do everything

The stated ambition is to build the Western equivalent of WeChat, where chat, shopping, payments, and money management all live in the same digital space. The idea isn’t new, people have been talking about it for years, and I already wrote about it when discussing Google Wallet turning into a super-app, as well as the broader trend of platforms absorbing every possible function. X Money thus competes directly with Venmo, Zelle, and Cash App, betting on higher yields and an audience already present on the social platform. The difference from previous attempts is the name behind it, and his knack for making headlines.

Not the first Musk promise that fell short

Honestly, this isn’t the first time his promises have let me down. In 2016 I reserved a Tesla Model 3, before the model even reached the market, putting down a thousand euros with my credit card, not with PayPal unfortunately, through a process that felt clunky for someone who worked in that exact field. The announced price was around 34,000 euros, the entry point meant to make electric cars finally affordable for everyone. Almost three years later, once the configurator opened in Italy, I discovered the real version, between the Performance trim and various options, came close to 80,000 euros. I walked away, and the deposit was refunded right away, no issues. Ever since, I take every Musk announcement with careful skepticism, X Money included.

My doubts as a former employee and shareholder

Here comes the more personal part, and the harder one to write. I don’t believe in this mission, or at least not in the terms it’s being told. I saw the payments industry from the inside for fifteen years: it’s an ecosystem shaped by different regulations in every country, complicated banking partnerships, fraud to prevent every day, and margins that keep thinning out. An announcement alone doesn’t turn that around. I’m also a PayPal shareholder, and the stock has lost roughly eighty percent of its value from the all-time high hit in July 2021, when it traded above $300, against current levels around $60. I feel that drop personally, but I mention it mainly for one reason: it shows how fragile even a company that shaped digital payments for decades can be, let alone a project starting from scratch inside a social network dealing with its own share of headaches, from declining ad revenue to legal battles. I already touched on this when writing about the PayPal signup button in Italy, and how much small details matter in an industry where trust builds slowly and disappears fast.

Payments don’t change with an announcement

The payments world remains multifaceted, full of nuances that someone who never worked in it struggles to grasp. Traditional banks certainly have their limits, and it’s no coincidence that things like Buy Now Pay Later or the wave of crypto applied to payments emerged precisely to fill those gaps. But overhauling personal finance with the same speed used to launch a new car model or a rocket is a different matter entirely. Time will tell whether X Money manages to earn the trust it needs, or whether it becomes just another chapter in a story, the one between Musk and payments, that traces back to the late nineties and has never really ended.

X Money, Elon Musk’s challenge