Key Takeaways:
- Elon Musk plans to launch a new messaging app called XChat to rival WhatsApp and Telegram.
- The app uses a peer-to-peer-based encryption system “similar to Bitcoin.”
- Experts say Musk’s description of Bitcoin-style encryption is vague and more branding than it is real cryptographic innovation.
Elon Musk revealed plans to launch a new messaging app called “XChat” to rival WhatsApp and Telegram, as part of the Tesla billionaire’s broader push to turn X, formerly Twitter, into an “everything app.”
In a recent interview with podcaster Joe Rogan, Musk said the service will use “a peer-to-peer-based encryption system similar to Bitcoin,” and will be available both as a standalone app and as a built-in feature on X.
“On X, we just rebuilt the entire messaging stack into what’s called XChat, Musk said. “It’s using a kind of peer-to-peer-based encryption system, similar to Bitcoin. Very good encryption. We’re testing it thoroughly.”
“XChat has no hooks for advertising. I’m not saying it’s perfect. But our goal with XChat is to replace what used to be the Twitter DM stack with a fully encrypted system where you can text, send files, and do audio and video calls. I think it will be the least insecure of any messaging system.”
The app will be “released in a few months,” Musk said, without specifying the date. He said XChat would have “no advertising hooks”, in a dig aimed at rival platforms, which he claims analyze user content for targeted marketing.
“WhatsApp knows enough about what you’re texting to know what ads to show you,” he alleged. “That’s a massive security vulnerability. Somebody can just use that same hook to get in there and look at your messages.”
The comments are the latest in Elon Musk’s often lofty rhetoric about growing the X ecosystem, which he has said will eventually include social networking, payments, and AI-driven services, just like WeChat in China.
XChat: Branding or Privacy Breakthrough?
According to Moe Levin, Chief Marketing Officer at Hemi, an execution layer for Bitcoin (BTC), Musk’s description of Bitcoin-style encryption is vague, more branding than genuine cryptographic innovation.
“Bitcoin’s network uses peer-to-peer (P2P) connections and public-key cryptography for transaction validation,” Levin told Cryptonews. “For a messaging app, a P2P system could route messages through peers and encrypt them, allowing only the intended recipient to read them.”
But such a “comparison is loose,” Levin says, because “Bitcoin itself does not encrypt network traffic or protect message content.” He doubts that XChat can match the Bitcoin network’s technical capabilities.
“Secure messaging requires forward secrecy, ephemeral keys, and metadata protections. Bitcoin’s cryptography secures transactions, not real-time messaging. So, calling it ‘Bitcoin-style encryption’ is, mildly put, misleading.”
In theory, P2P frameworks can reduce the reliance on centralized servers that store message data, experts say. But as Levin noted, building such a system at scale is tough. Users will be skeptical about XChat, he says.
“Musk has promised many things,” he said, “whether it be landing on Mars, flying cars, or humanoid robots at home. We will see if this is something he can pull off.”
XChat is coming into a market that’s seeing a change in user behavior, according to Sasha Barrie, founder of social media agency Hype.
Speaking to Cryptonews, Barrie said people are moving away from public feeds to small, private group chats on WhatsApp and Telegram, where content is spread directly through trusted circles rather than algorithms.
“From what we know, XChat will be an integrated direct messaging feature on X, similar to how Messenger is part of Facebook,” she said.
“It will automatically have the X audience and will also likely be integrated with Grok, which will differentiate it from the other players,” she added.
In a crowded market, however, Barrie believes encryption alone will not be able to attract new users to XChat.
“I don’t think privacy will be the main selling point. Most users don’t care about it enough. XChat is likely an attempt to keep the conversation on X instead of it leaking away to other platforms.”
Privacy Apps Under Pressure from Regulators
The Hype founder spoke about how XChat could help Musk rebuild user engagement on X, where public activity and advertiser interest appear to have taken a knock since his $44 billion takeover in October 2022.
“In recent years, a lot of the user’s attention is no longer in the feeds that are governed by the algorithms people don’t trust,” she observed, adding:
“Depending on more specific functionality around group chats on XChat — how many members allowed in a group, gated access, payments — there’ll likely be some new use cases. Some of the market might come from Substack, as it’s been great for gated access but not so great for discovery.”
Experts say Musk’s focus on encryption with XChat could invite scrutiny from regulators and governments that are keen on pushing back against total privacy in social media networks, which they say enable criminal activity.
“Any new messaging app touting strong encryption, especially one from a high-profile figure like Musk, will be held under a microscope by regulators,” Joshua Chu, a lawyer and co-chair of the Hong Kong Web3 Association, told Cryptonews.
In the European Union, says Chu, rules under the GDPR and the Digital Services Act require tech companies to ensure user transparency and “clear” data protection while complying with law enforcement.
The United States is moving in the same direction, he adds, with state and federal-level debates over encryption backdoors and lawful access.
“Musk’s brand of free speech and minimal government intervention is attractive to privacy advocates, but it also draws the attention of regulators eager to test those limits, especially as XChat’s structural reach and user base grow.”
In Asia, the political and legal risks are much bigger. For example, Chu said Hong Kong’s National Security Law has put pressure on privacy-first platforms like Telegram to restrict content seen as sensitive or illegal.
“Content deemed unacceptable or threatening by authorities can trigger court actions seeking to block, restrict, or penalize global tech firms,” Chu tells Cryptonews, adding:
“Telegram’s standoffs with governments highlight how companies can be legally challenged, not merely for hosting end-to-end encrypted chats, but for alleged inaction in moderating illegal or sensitive content.”
Chu said XChat would have to balance privacy with compliance if it hopes to avoid the regulatory pitfalls faced by Telegram, whose CEO, Pavel Durov, was last year arrested by the French police under a warrant related to the app.
Durov is currently out on €5 million bail. The 40-year-old billionaire, who is known for his focus on privacy, criticized his arrest as “legally and logically absurd.”
Musk’s Everything App Ambitions
Musk has previously spoken about turning X into an “everything app,” similar to China’s WeChat. He wants to go beyond social media, adding financial payments, smart home controls, and even ride-hailing to the site.
X is currently enjoying success with its socially embedded generative AI chatbot, Grok. Recently, Musk revealed plans to relaunch Vine in an AI format. Twitter shut down the short video app in 2017 due to rising competition.
The Tesla and SpaceX founder has also hinted that integrated payments on X could roll out in 2025. Analysts say XChat is the latest piece in Elon Musk’s push to transform X into an “everything app.”
“It’s an attempt to strengthen the ecosystem in preparation for the payments rollout,” said Barrie, the Hype founder.
“XChat will likely find its own place in the market of messengers and bring some new use cases that will be unique to the platform.”
In his interview with Rogan, Musk referenced Tucker Carlson’s interview with Vladimir Putin, alleging that U.S. agencies spent $750,000 trying to decrypt his messages with the Russian President’s team.
Musk said it is possible to decrypt encrypted messages, but “it’s just not that easy to do.” “I think you should view any given messaging system as not whether it’s secure or not, but there are degrees of insecurity,” he said.
He hopes that with Bitcoin-like, peer-to-peer-based encryption, XChat will be the “least insecure of any messaging system.”
The post What Is XChat, Musk’s New Social App With Bitcoin-Like Privacy? appeared first on Cryptonews.
