Senator questions Elon Musk on X Money plans

Questions are arising for Elon Musk concerning his new payment service, X Money, and its ability to ensure safe transactions for users. 

In a communication to Musk, Senator Elizabeth Warren (D-MA) expressed that X Money might threaten “consumers, national security, and financial system stability,” mentioning Musk’s previous operations with X.

Musk has stated that X Money will be accessible to the public starting in April. Although details remain sparse, Linda Yaccarino, former CEO of X, mentioned last year that it will enable users to load funds into their X Wallet with Visa’s Direct service, link to debit cards for easy transactions, and offer bank account transfers.

However, Warren, who serves as the lead Democrat on the Senate Committee on Banking, Housing, and Urban Affairs, doubts Musk’s capability to run a secure payment service. 

The letter highlights X’s regulatory criticisms regarding the spread of child sexual abuse material, some of which is produced by its AI tool Grok. 

It also refers to a Tech Transparency Project report indicating that X enables users subject to US sanctions, including members affiliated with Hezbollah and Houthi leaders, to purchase a Premium membership. 

“This history raises grave concerns about potential risks involving privacy, fraud, and illegal finances associated with X Money,” Warren states.

The document also points to screenshots of X Money shared by Star Trek’s William Shatner, who tried the platform early. 

One screenshot indicates that X Money funds are “held by Cross River Bank,” which Warren claims underwent a “significant enforcement issue” by the FDIC in 2023 due to “unsafe lending practices.” Warren further points out that “the bank has a history of violations, with a previous enforcement action in 2018 due to unfair practices.”

Additionally, Warren highlights the DOGE-led weakening of the Consumer Financial Protection Bureau (CFPB) which established a rule in 2024 enabling the agency to regulate digital payment systems like X Money. 

“You have benefited from the CFPB's weakening and the withdrawal of its powers,” Warren declares. “Following DOGE’s intervention at the CFPB, Acting Director Vought closed the organization’s headquarters, attempted to dismiss nearly 90% of its staff, and halted ongoing cases against financial bodies in violation of the law, among other moves to weaken the agency.” 

The crypto-oriented GENIUS Act also features a “dubious exception” granting private entities like X the right to introduce stablecoins, Warren adds, aligned with X’s indication of possible crypto market entry.

Musk has until April 21 to reply to over a dozen inquiries regarding X Money, including confirming Cross River Bank as its collaborator, whether there are plans to create a stablecoin, and the measures in place to thwart scams, fraud, and illegal finance.