X adds money transmitter licenses in Florida, Arkansas
X has been busy in its ambition to becoming an everything app, adding money transmitter licenses from Arkansas and Florida since mid-December, which brings its total state licenses to 15.
Why it matters: Broadly speaking, the licenses allow the platform (formerly called Twitter) to offer users in those states the ability to pay each other within the app, which could eventually put X in the same competitive field as Square or PayPal.
Context: These new licenses, which were not previously reported, come as X confirmed plans to launch a peer-to-peer payments network in a blog post Tuesday.
- With the addition of Florida, X now has a license in one of the three most populous states in the U.S.
- Musk had previously told employees that he plans to launch financial features by the end of 2024, per the Verge.
Details: X obtained its Florida license on Dec. 27 and its Arkansas license on Jan. 5, per its payments website. The Florida Office of Financial Regulation's website and the Nationwide Multistate Licensing System confirm that information.
Between the lines: X still lacks money transmitter licenses in some coveted, but also heavily regulated, states, including New York, Texas and California, its home state. Obtaining licenses in those states often speeds up the process in others.
- For example, the process in New York has become more stringent after a wave of crypto-related blowups.
- Regulators there expect license-seekers to be well along in their business plans, prompting many companies to hold off on applying in New York.
Zooming in: State regulators will look at the financial health of the company, its investors, and its business plan.
- "Regulators need proof that it is not insolvent, that they aren't running significant losses for a long period of time, and that major investors have no risk of misappropriating funds and are a source of strength," says Timothy Crisp, a partner at Holland & Hart.
- "They need proof that someone is going to prop it up if needed and that no one is going to run it to the ground."
What they're saying: X has not yet responded to a request for comment.