Binance is backing Elon Musk's Twitter acquisition — here's why it's a big deal for crypto enthusiasts

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Bitcoin exchange Binance's move to participate in Elon Musk's $44 billion takeover of Twitter could boost digital currency evangelists' hopes for the development of a more «decentralized,» crypto-friendly social media platform.

Binance plans to invest $500 million in equity funding as part of a $7 billion financing pledge to support the Tesla CEO's bid to buy Twitter. Oracle co-founder Larry Ellison and venture capital firm Sequoia are among the other investors involved.

Binance's participation is curious, not least because of the business it operates. The company is the world's largest crypto exchange, handling more than $70 billion in spot and derivative trading volumes on a daily basis, according to CoinGecko data.

Changpeng Zhao, Binance's billionaire CEO and founder, is a big believer in the crypto world's vision of a new kind of internet, known as «Web3.» It's an ill-defined term, but Web3 as a concept loosely refers to new web experiences built around blockchain, the technology that underpins many cryptocurrencies.

Such services could incorporate digital tokens like NFTs — the crypto equivalent of collectible items like rare art or trading cards — into things like social media, web browsers or video games.

«I definitely it's the future,» Zhao told CNBC in an interview last month. «But exactly how it's gonna shape up; what exactly does Web3 looks like? We'll have to wait and see.»

Binance's stake in Twitter could be Zhao's chance to realize Web3's decentralized ideals. Musk, a self-proclaimed «free speech absolutist,» has frequently bemoaned what he views as censorship by Twitter of conservative-leaning voices on the platform.

Bitcoin and other digital currencies aren't controlled by any single