Musk Drops XChat with Bitcoin-Grade Encryption—Just as Crypto Wars Heat Up

Elon Musk’s latest play: XChat, a messaging platform wrapped in Bitcoin-level encryption. Dropped right as regulators sharpen their knives for crypto.

Why it matters: When the world’s richest chaos agent pivots to privacy tech, Wall Street’s compliance officers reach for the Xanax. The timing? Impeccable—like a Tesla hitting Ludicrous Mode during a SEC investigation.

The kicker: This isn’t just end-to-end encryption. It’s Satoshi-style. The same unbreakable math that keeps your BTC safe now guards your DMs. Cue the privacy maximalists cheering—and the surveillance state sweating.

Bonus cynicism: Nothing solves ’funding secured’ trust issues like blockchain-grade message sealing. Except maybe not tweeting at 3AM.

Crypto community split over ‘Bitcoin-Style’ encryption

Musk’s reference to “Bitcoin-style encryption” has stirred debate in the crypto space, with some developers arguing that the phrase is misleading.

Bitcoin Core developer Luke Dashjr pushed back, stating that Bitcoin itself doesn’t use encryption and criticized the choice of Rust for security-critical components. He noted:

“Bitcoin doesn’t even use encryption.. Also Rust is woke.”

On the other hand, BitMEX Research suggested Musk may be referencing BIP-151, a proposal to encrypt data exchanged between bitcoin nodes.

Meanwhile, Wei DAI of 1kx speculated that the reference could relate to Bitcoin’s peer-to-peer communication design. He said:

“‘Bitcoin style’ ~= ‘Peer-to-peer’ ~= ‘end-to-end.’ So ‘Bitcoin style encryption’ means ‘end-to-end encryption.’”

Other experts pointed to Elliptic Curve Cryptography (ECC), a mathematical method used in Bitcoin to generate and manage private keys, as a possible explanation.

Despite the mixed reactions, XChat is now available in beta to some premium subscribers and is widely viewed as a direct challenge to privacy-focused apps like WhatsApp and Signal.

If successful, XChat could mark a significant step forward in Musk’s vision of a secure, all-in-one communication and finance hub.