NEW YORK (BLOOMBERG) - Binance Holdings has committed US$500 million (S$694 million) for billionaire Elon Musk's proposed takeover of Twitter, in the hope of a more decentralised, crypto-friendly social media platform and Internet.
"We are excited to be able to help Elon realise a new vision for Twitter," Mr Zhao Changpeng, chief executive officer of Binance, said in a statement. "We hope to be able to play a role in bringing social media and Web3 together and broadening the use and adoption of crypto and blockchain technology."
Web3 is a catch-all term referring to a vision of the World Wide Web as a decentralised environment that uses blockchain technology and digital tokens to wrest control of the Internet from giant technology companies.
The deal was part of the US$7.1 billion of new financing that Mr Musk has secured for his proposed US$44 billion takeover of Twitter. Sequoia Capital Fund, Qatar Holding and Brookfield Asset Management are among other backers in the package.
Twitter is a key platform for online discourse by the crypto community. On Wednesday (May 4), Mr Musk briefly changed his Twitter avatar to a collage of Bored Ape non-fungible tokens, one of the most popular collections on the market. This resulted in a surge in the price of the ApeCoin token during European hours.
Binance is creating an internal team to focus on how blockchain could be helpful to Twitter and other social platforms, and has brought up BNB Chain - a distributed ledger Binance helped to build - to Mr Musk and his team, said Binance chief communications officer Patrick Hillmann in an interview.
'Once in a lifetime'
"This is probably one of the greatest laboratories that Web3 has ever had access to," Mr Hillmann said. "It is a once-in-a-lifetime opportunity."
BNB Chain is already used for decentralised finance and other applications and supports a token called BNB, which has a market capitalisation of about US$61.8 billion.
Prior to the funding announcement, Mr Zhao told Bloomberg TV that Binance is ready to invest in any "strong business with existing users, existing models" that can be helped with additional monetisation models using Web3, blockchain and cryptocurrencies
The company is also interested in investing in sectors such as gaming, e-commerce, logistics and real estate. In these industries, "we will be pretty passive and pretty silent", he said.
Binance announced in February that it is making a strategic investment of US$200 million into the more than 100-year-old news publisher Forbes and will advise its digital assets strategy.
A Binance spokesman declined to share further details on the deal when asked if the company will pay for funding in crypto.