News & Analysis

Jack Dorsey sells NFT of tweet for $2.9m and Square buys Tidal, what’s next?

26 Mar 2021 | by: Kirsteen Mackay

Jack Dorsey sells NFT of tweet for $2.9m and Square buys Tidal, what’s next?

Twitter (NYSE:TWTR) founder Jack Dorsey sold his very first tweet via non-fungible token (NFT) for an incredible $2.9 million worth of Ethereum. He says the proceeds will be converted to Bitcoin and donated to an African charity.

Twitter's Jack Dorsey sells first tweet for $2.9m. Square buys Tidal.
Jack Dorsey sells first Tweet – Photographer: Alexander Shatov | Source: Unsplash

The tweet simply said: “just setting up my twttr” and was written at 8:50 PM on Mar 21, 2006.

just setting up my twttr

It was sold via NFT auction site Valuables by Cent.

Jack donates NFT tweet proceeds to African charity

After a two-week bidding war, he ended the auction on the 15-year anniversary of the tweet. The buyer was Mr Estavi, CEO of cryptocurrency firm Bridge Oracle. He’d been bidding against Tron CEO Justin Sun.

He’s adamant it’s a good buy, tweeting: “This is not just a tweet! I think years later people will realize the true value of this tweet, like the Mona Lisa painting

“This is not just a tweet” Jack Dorsey NFT sale

Mad money

After 2020 saw money freely printed into the global economy, ‘stocks only go up’ and GameStop (NYSE: GME) mania at the turn of the year, this NFT craze seems like the next logical chapter in a world where money’s gone mad. The entire NFT market is now worth $1 billion.

So far, NFT mania is not subsiding, but with a never-ending stream of tweets, artwork and songs around, it’s likely only a select few will command big money.

The creation of an NFT happens using the Ethereum network. This blockchain technology ensures the buyer can confidently establish ownership and authentication.

To discover more about the ins and outs of these crazy new digital assets read our previous NFT article.

Square buys Tidal

While Twitter launched Dorsey’s career, it’s not his only big project. He’s also the founder of modern finance vehicle Square (NYSE: SQ), which has just bought Jay-Z’s music streaming service Tidal.

In an elaborate way, it appears Dorsey is gradually bringing all his various investments together in a strategic synergy.

American fintech, Square, is a favourite addition to Cathie Wood’s ARK Invest funds as she sees it as the future of the modern banking system.

Opening doors with cryptocurrency

Dorsey is no stranger to cryptocurrency and exciting new ventures. Back in 2019, he invested in a $10 million funding round for San Francisco based CoinList, which operates in the tokenization space.

And late last year, Square purchased $170 million in Bitcoin. This raised Square’s Bitcoin holding to 5% of the company’s cash and equivalents.

Meanwhile Tidal is a Norwegian subscription-based music, podcast and video streaming service.

It seems Square’s alignment with Tidal could bring a wide assortment of opportunities to artists.

Square is on the pulse of making financial transactions simple for small businesses, in both the physical world and online. It’s even making strides in far-flung hostile environments thanks to its ease of use and investment in Bitcoin.

The potential to tap new markets and expand its global footprint is immense and by bringing the power of music and entertainment onboard it could open doors all over the planet.

In an extensive tweet thread Dorsey explained:

“Given what Square has been able to do for sellers of all sizes and individuals through Cash App, we believe we can now work for artists to see the same success for them, and us… we believe there’s a compelling [intersection] between music and the economy. Making the economy work for artists is similar to what Square has done for sellers.”

The power of TIDAL and Square

Immersing artists in a money-spinning ecosystem

“Square created ecosystems of tools for sellers & individuals, and we’ll do the same for artists. We’ll work on entirely new listening experiences to bring fans closer together, simple integrations for merch sales, modern collaboration tools, and new complementary revenue streams.”

Artists, from the amateur to exceptional, could take advantage of Twitter and Square to interact directly and sell to their fanbase. This could create a mini ecosystem where artists can thrive, and fans be entertained. If handled well, it’s got the makings of a next level money-spinner for all involved.

Perhaps Square will help artists sell their merchandise all year round, with extra ease and ability when on tour. Or it could encompass its very own NFT marketplace, where artists can sell their digital creations to grateful fans.

Tidal may not yet be as big as Spotify, but with Square, Cash App and Twitter on hand, it’s just a matter of time before the tide turns.

With so much social power at his disposal, Dorsey has the ability to give artists a wealth generating platform all of their own. For instance, an artist could market their product through Twitter, get paid for it through Cash App or Square, and own their exclusive content on Tidal.

Facebook doesn’t have this level of monetisation power. Apple (NASDAQ: AAPL) and Amazon (NASDAQ: AMZN) are attempting to pull something similar off by investing billions. But it seems Dorsey has a setup very close to perfect, getting artists ready to rock-and-roll.

Dorsey respects artists

The big difference is Dorsey’s appreciation of artists. While Spotify has alienated artists and disappointed them, Dorsey has already been using his clout and tools to help artists get ahead.

In buying Tidal he ensured the artists already invested receive shares in the new company so that they retain a sense of ownership. And the deal also led Dorsey to appoint American rapper Jay-Z as a board member of Square.

According to a press release by Square, the company plans to pay a mix of cash and stock of $297 million for a significant majority ownership stake. Existing artist shareholders will be the remaining stakeholders. The transaction gives Tidal a valuation of around $450 million.

Even if this is a slow burning growth area for Dorsey, the deal cost very little in relation to the net worth of Square. Yet, it’s brought a band of celebrities to the table and plenty to talk about., Digitonic Ltd (and our owners, directors, officers, managers, employees, affiliates, agents and assigns) are not responsible for the content or accuracy of this article. The information included in this article is based solely on information provided by the company or companies mentioned above.

This article does not provide any financial advice and is not a recommendation to deal in any securities or product. Investments may fall in value and an investor may lose some or all of their investment. Past performance is not an indicator of future performance.

  • Kirsteen Mackay does not hold any position in the stock(s) and/or financial instrument(s) mentioned in the above article.
  • Kirsteen Mackay has not been paid to produce this piece by the company or companies mentioned above.

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