Why Elon Musk Spells Trouble for Trump’s Truth Social

In the volatile landscape of social media, Truth Social—the flagship application of the Trump Media & Technology Group (TMTG)—finds itself caught in a multi-fronted quagmire. Not only is the platform struggling to match its rivals in terms of technological agility and audience retention, but it is now facing an existential threat from an unlikely quarter: Elon Musk. The Tesla tycoon’s aggressive pursuit of Twitter has fundamentally undermined Truth Social’s raison d’être, just as the fledgling app grapples with executive exoduses and a stalled multi-billion-dollar merger.

The Musk Factor: A Battle for the “Free Speech” Crown

For months, Truth Social was marketed as the “carefree” conservative alternative to a “censorious” Twitter. However, Elon Musk’s hostile takeover bid has shifted the spotlight. Having secured $46.5 billion in financing, Musk has signalled a desire to significantly loosen Twitter’s content moderation policies—the very policies that famously led to Donald Trump’s permanent suspension following the events of 6 January 2021.

Karen Freberg, a professor of strategic communications at the University of Louisville, suggests that Truth Social may have missed its window of opportunity. “Truth Social could have succeeded if given a clear run,” she observed. “But the Twitter saga has reclaimed the media narrative, and Musk is wielding his immense influence to occupy the territory Truth Social once claimed for itself.” While Mr Trump has publicly stated he “probably wouldn’t join Twitter again,” even if invited back, the mere possibility of a reformed Twitter removes the primary incentive for his base to migrate elsewhere.

A Financial House of Cards: The SPAC Merger at Risk

Beyond the competitive threat of a Musk-led Twitter, Truth Social’s financial foundations are looking increasingly precarious. The proposed merger between TMTG and Digital World Acquisition Corp (DWAC)—a “blank-cheque” Special Purpose Acquisition Company (SPAC)—is fast approaching a series of “do-or-die” deadlines.

If the merger is not finalised by 8 September, or a formal extension granted, the $300 million raised in DWAC’s initial public offering could vanish. Furthermore, investors involved in a separate $1 billion private placement could legally withdraw their support if the deal remains incomplete by 20 September.

The primary hurdle is a rigorous investigation by the Securities and Exchange Commission (SEC). Regulators are scrutinising “suspicious trading activity” that occurred prior to the deal’s announcement, alongside potential illicit communications between the two firms before DWAC went public. The severity of this inquiry was underscored by Kerrisdale Capital, a prominent short-selling hedge fund, which recently predicted that the SEC would never grant the merger its final blessing.

Comparative Metrics: A David vs Goliath Struggle

The scale of the challenge facing Truth Social is best illustrated by its performance metrics relative to the incumbent it seeks to replace. Despite Mr Trump reaching the one million follower milestone on his own app, it remains a shadow of the 89 million followers he once commanded on Twitter.

Operational Turmoil and Executive Departures

The internal mechanics of TMTG appear as fractured as its finances. Since its launch, the platform has been marred by technical glitches and a formidable waiting list. This developmental friction reportedly led to the resignation of two pivotal figures: Josh Adams (Chief Technology Officer) and Billy Boozer (Chief Product Officer). Known to investors only by the somewhat cryptic mononyms “Josh A” and “Billy B,” their departure has left a void at the top of the firm’s technical hierarchy.

Furthermore, the company’s lack of transparency has riled investors. While other SPACs typically file an S-4 registration document within two months of a merger announcement, DWAC has yet to produce one, six months into the process. This document is a critical milestone, and its absence suggests that the regulatory hurdles are far from being cleared.

While TMTG CEO Devin Nunes—the former Congressman—has attempted to dismiss Twitter as a “ghost town” during interviews on Fox Business, the reality remains that Mr Trump himself has posted only once on his own platform since February. As the clock ticks down toward the September deadlines and Elon Musk continues his siege of Twitter, Truth Social is fighting not just for market share, but for its very survival.