Elon Musk Unveils XChat With “Bitcoin-Style Encryption” — But Bitcoiners Push Back

Elon Musk’s social media platform X is rolling out a major upgrade to its direct messaging system, called XChat, promising features like encryption, vanishing messages, audio/video calls, and the ability to send any type of file. But Musk’s claim that it will have “Bitcoin-style encryption” has sparked a flurry of corrections and debate from the crypto community.

In a June 1 post on X (formerly Twitter), Musk described XChat as a next-generation messaging service built on the Rust programming language, boasting a “whole new architecture” and Bitcoin-like encryption. The announcement came shortly after X paused its previous encrypted messaging feature on May 29 to implement improvements — likely linked to the XChat rollout.

Crypto Experts Correct Musk on Bitcoin Encryption

Musk’s description drew swift technical pushback from Bitcoin experts.

• Samson Mow, CEO of JAN3, pointed out: “Bitcoin isn’t encrypted.”

• Crypto influencer Pledditor clarified that Bitcoin relies on elliptic curve cryptography (ECC), not traditional encryption.

• Bitcoin core developer Luke Dashjr weighed in, stating bluntly, “Bitcoin doesn’t even use encryption,” and criticized the use of Rust for security purposes.

•  BitMEX Research speculated that Musk might have been referencing BIP-151, a Bitcoin Improvement Proposal for peer-to-peer communication encryption between Bitcoin nodes.

Source: Elon Musk

To break it down, Bitcoin’s security model is based on elliptic curve cryptography, which functions like a mathematical lock: users hold a private key, and a public key is derived from it, enabling secure transactions without revealing sensitive data. Bitcoin also uses SHA-256 hashing to validate transactions and generate block IDs — again, not traditional encryption.

XChat: Taking on Telegram, Signal, and Beyond

Despite the crypto terminology confusion, XChat represents a clear move by X to challenge popular encrypted messaging apps like Telegram and Signal. According to a report by TechCrunch, XChat is currently rolling out to paid subscribers and is protected by a four-digit passcode for added security.

X Money: Next Step Toward an “Everything App”

Beyond messaging, Musk has broader ambitions. On May 25, he confirmed that X is testing X Money, a payments feature set to launch in beta later this year.

“This will be a very limited-access beta at first,” Musk noted, adding, “When people’s savings are involved, extreme care must be taken.”

Musk’s vision is to turn X into an “everything app” — similar to China’s WeChat — combining social media, messaging, payments, and other services under a single umbrella.

Having acquired Twitter in October 2022, Musk has repeatedly promised to push the platform far beyond its original social media roots. With XChat and X Money, the company is now positioning itself to compete directly with fintech apps like Venmo and Cash App as well as encrypted messengers.

Final Thoughts

While Musk’s “Bitcoin-style encryption” claim may not be technically accurate, the launch of XChat marks a significant leap in X’s push to broaden its feature set and deepen user engagement. As Musk’s vision for an all-in-one platform takes shape, it will be worth watching how X balances innovation with security — especially as it moves into the sensitive realm of private communications and financial transactions.