Twitter May Face Bankruptcy As Key Executives Resign – Elon Musk

Elon Musk has said Twitter may face bankruptcy as key security executives have resigned from the organisation, drawing a sharp warning from US regulators.

Gatekeepers News reports that the walkouts came a day after the turbulent launch of new features introduced by Tesla and SpaceX owner Musk following his $44 billion buyout of the influential messaging app.

On Thursday, Musk warned employees that the site was burning dangerously through cash, raising the specter of bankruptcy if the situation was not turned around.

Chief Security Officer Lea Kissner, tweeted, “I’ve made the hard decision to leave Twitter.”  Kissner reportedly stepped down with other key privacy or security executives.

US media further reported that the Site’s Head of Trust and Safety, Yoel Roth stepped down just a day after defending Musk’s content moderation policy to advertisers.

The disruptions followed the unveiling of the site’s long-awaited Twitter Blue subscription service, which allows users to pay $7.99 per month for a coveted blue tick, as well as a separate gray “official” badge for some high-profile accounts.

However, the release descended into unrest on Wednesday when Musk scrapped the new gray label almost immediately, outweighing the launch of the pay service, which is currently only available on the mobile app on iPhones and in the United States.

The launch also saw the emergence of a flurry of fake accounts as users used the opportunity to impersonate celebrities and politicians such as NBA star LeBron James or former British Prime Minister Tony Blair.

The tumult drew a rare warning from the Federal Trade Commission, the US authority that oversees consumer safety which had put Twitter under watch for past security and privacy breaches.

“We are tracking recent developments at Twitter with deep concern,” a spokesperson for the FTC said in a statement.

“No CEO or company is above the law, and companies must follow our consent decrees,” the spokesperson added, referring to past commitments by Twitter to obey US privacy rules.

Violating FTC decisions could cost Twitter millions of dollars in fines.

The 51-year-old entrepreneur fired half of the 7,500 employees of the California company a week ago, 10 days after buying the site and becoming its sole owner.

According to an employee text message sighted by AFP, For the first time since the layoffs, Musk on Thursday addressed his remaining employees and urged them to help the site reach one billion users.

Musk also warned that Twitter was bleeding cash and expressed fear about the effects of the poor economy on his newly bought business.

“You may have noticed I sold a bunch of Tesla stock. The reason I did that is to save Twitter,” he is reported to have said.

Wedbush analyst Dan Ives meanwhile warned that the Twitter episode could have serious repercussions for electric car manufacturer Tesla.

“Brand destruction is our biggest worry with this Twitter circus show. It’s that simple and I can’t ignore it for Tesla stock,” Ives wrote on the site.

Twitter is also crippled by the decision of advertisers to stay away from the platform, concerned about Musk’s plans.

The tycoon announced he was ending work-from-home policies at Twitter, which had been a widespread practice at the San Francisco-based company.

“If you don’t show up at the office, resignation accepted,” he told employees.