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You’ve seen the headlines, right? It feels like every other day there’s a new "end of an era" post about X, formerly known as Twitter. But honestly, if you actually look at the data coming out of early 2026, the reality is a lot weirder—and more calculated—than the doom-scrolling might suggest. Elon Musk isn't just "running a social media site" anymore. He's basically trying to turn X into a high-stakes combination of a digital bank, a video production house, and an AI laboratory.
It’s been a chaotic start to the year.
Just this past week, in mid-January 2026, the platform got hit with back-to-back outages that left tens of thousands of people staring at "Something went wrong" screens. It happened twice in three days. For a site that’s trying to convince you to trust it with your money and your long-form journalism, that’s a tough look. But while the technical side is flickering, the business strategy is moving at a breakneck pace.
The $1 Million Article and the Pivot to Creators
X just announced something pretty wild: a $1 million prize for the "Top Article" of the next payout period. This isn't just a random giveaway. It’s part of a massive 2026 push to steal the thunder from platforms like Substack and LinkedIn. Musk is calling 2026 "the year of the creator," and he’s putting serious cash on the line to prove it.
The goal? High-impact content. They want the kind of investigative pieces and cultural deep-dives that used to live in traditional magazines. By offering a million-dollar carrot, they're basically begging journalists and "thought leaders" to ditch their own blogs and move everything to X.
But it’s a bit of a gamble.
Most people still use the app for quick-fire news and sports updates. In fact, current stats show that about 48% of users are there specifically for the news. Will they actually sit down and read a 5,000-word essay on their phone? X is betting a million dollars that they will. They've even updated the "Articles" feature with better formatting and embedded media to make it feel less like a long tweet and more like a real digital publication.
Grok, Deepfakes, and the Legal Firestorm
If the creator push is the "good news," the AI side is where things get messy. Musk’s AI, Grok, is at the center of a massive global backlash right now.
California’s Attorney General, Rob Bonta, just launched an investigation into xAI (the company behind Grok). The issue is the proliferation of nonconsensual AI-generated images. Basically, people were using Grok’s image-editing tools to create sexualized deepfakes of real people, including minors. It got so bad that countries like Malaysia and Indonesia actually blocked Grok entirely this month.
X tried to get ahead of it by announcing new "technological measures" to stop Grok from editing photos of real people into revealing clothing. They also paywalled the image tools. Now, if you aren't a Premium subscriber, you can’t use them. Musk’s stance has been pretty blunt: he says anyone making illegal content will "suffer the same consequences" as if they uploaded it directly.
Despite the controversy, Grok 5 is still slated for release in Q1 2026. This thing is a monster. We’re talking:
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- 6 trillion parameters (double the size of Grok 4).
- Native multimodal capabilities, meaning it can "watch" a video and answer questions about specific moments in the footage.
- Project Musketeer, a rumored feature that would let the AI perform multi-step tasks on your behalf without you watching over it.
Musk is even claiming there’s a "10% and rising" chance this model achieves AGI (Artificial General Intelligence). Most researchers think he’s exaggerating, but the raw compute power he's throwing at it is undeniable.
The Money: Is X Actually Profitable?
Surprisingly, the financial side isn't as grim as the critics predicted back in 2023. X reported roughly $752 million in revenue for the first quarter of 2026. That’s actually a 17% jump from last year.
They aren't fully in the black yet—they’re still "operating in the red"—but the losses are shrinking. The platform is leaning heavily into video ads and specialized "Grok for Enterprise" APIs. Advertisers are slowly trickling back, or at least being replaced by a new wave of niche brands and crypto companies.
Speaking of crypto, the community on X is massive. There are about 15 to 18 million daily active users who are solely there for the "Crypto Twitter" scene. That’s roughly 7-8% of the entire daily user base. It’s a huge chunk of the platform’s engagement, which explains why Musk keeps pushing for integrated payment features.
Why the Music Industry is Suing (Again)
You can't talk about Elon Musk Twitter latest news without mentioning the lawsuits. It’s like a sport at this point.
On January 11, 2026, X filed a massive antitrust lawsuit against several major music publishers and the National Music Publishers' Association (NMPA). X is accusing them of "collusion" to force the platform into expensive licensing deals.
The background here is that X is the only major social media platform that doesn't have a broad licensing deal for music. TikTok, Instagram, and even Roblox pay up so users can use songs in their videos. Musk’s argument? Music isn't that important to X, so he shouldn't have to pay the same rates as TikTok. The music publishers, obviously, disagree. They say X has been "engaging in copyright infringement for years."
It’s a classic Musk move: sue the people who are suing you. If he wins, he saves hundreds of millions. If he loses, the platform might face even more restricted content.
Breaking Down the 2026 User Base
The numbers are a bit of a mixed bag. Depending on who you ask, X has anywhere between 421 million and 561 million monthly active users.
- The US is still the king: Over 100 million users.
- Japan is a close second: 70 million users (they love X over there).
- The "Age Gap": Almost 70% of the audience is between 18 and 34.
However, the "monetizable daily active users" (the people who actually see the ads) seems to have plateaued around 245 million. People are spending about 32 to 34 minutes a day on the app, which is decent, but the engagement rate for organic posts has actually dropped to about 0.015%. Basically, it's getting harder and harder to "go viral" unless you're paying for a subscription or using video.
What This Means for You (Actionable Steps)
If you're using X for business or building a personal brand, the landscape has changed. You can't just tweet a few sentences and hope for the best anymore.
1. Go Video or Go Home
Video consumption on the platform is up 40% year-over-year. The algorithm is heavily favoring short-form video and live streams. If you aren't posting at least one video a week, you're basically invisible to 90% of your followers.
2. Experiment with "Articles"
With that $1 million prize on the table, the platform is boosting the reach of long-form writing. If you have a newsletter or a blog, try cross-posting your best work as an "Article" on X. The formatting tools are actually quite good now, allowing for headers and clean layouts.
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3. Watch Your AI Usage
With the California investigation and new "deepfake" laws, be extremely careful with AI-generated imagery. The "Wild West" era of Grok is ending. Stick to using AI for text-based brainstorming or data analysis rather than risky image manipulation.
4. Diversify Your Presence
The recent outages in January are a reminder that X is still a platform in transition. Don't let it be your only home. Use X for real-time engagement and news, but make sure you’re collecting emails or building a presence on a more stable secondary platform.
The "everything app" is still a work in progress. It's glitchy, it's litigious, and it's obsessed with AI. But with 500 million posts still going out every day, it remains the world’s most chaotic, real-time newsroom. Whether Musk can turn that chaos into a profitable, safe environment by the end of 2026 is still the billion-dollar question.