X Launches Marketplace for Inactive Usernames Amid Ad Revenue Decline

X is finally launching a marketplace for inactive handles that will allow Premium subscribers to request and purchase usernames, with rare handles potentially priced anywhere from $2,500 to over seven figures. As expensive as that sounds, fortunately the marketplace offers both free and paid options for acquiring eligible handles, marking the platform’s latest revenue diversification effort as advertising income continues to decline.

Said move addresses a long-standing user frustration which is millions of dormant usernames remaining locked away while active users settle for not-so-impressive alternatives. By bringing the underground handle trade in-house, Elon Musk’s platform can finally capture revenue it previously lost to third-party brokers.

How the Marketplace Works

X has basically divided its handle marketplace into two tiers. “Priority” handles include usernames like @GabrielJones, @PizzaEater, and @ParadoxAI. These are typically full names, multi-word phrases, or alphanumeric combinations. These handles are free to request for Premium+ and Premium Business subscribers.

However, there’s a significant catch of course. If a user cancels or downgrades their subscription, their old handle returns to their account after a 30-day grace period. As one analyst noted,

“The biggest catch here is that you must be a Premium Plus or Premium Business subscriber to take part in this marketplace.”

“Rare” handles include short, generic, or culturally significant names like @Pizza, @Tom, and @One. These are not available through standard requests. Instead, they’re offered through Public Drops, where multiple people can apply based on their platform contributions and engagement. These are also available through Direct Purchases by invitation only, with pricing determined mainly by factors like popularity, character length, and cultural significance.

X notes that not all requests are approved, and requests are usually reviewed within three business days. Users can also “Register” interest in specific inactive handles to add them to a Watchlist, and X will notify them if these become available.

The Revenue Crisis

The timing of this marketplace reveals X’s desperate need for new revenue streams. Only 4% of marketers believe X ads provide “brand safety,” compared to 39% for Google ads, according to market research firm Kantar. The same study found that a net 26% of marketers plan to decrease their spending on X in 2025 officially marking the biggest recorded pullback from any major global ad platform.

X’s ad revenue, though,  has seen consistent year-over-year declines, with the biggest drop coming in at 27% after June 2024. Between February 2023 and January 2024, X only accounted for 3% of global ad spend, while ad revenue for the platform decreased by 64% in that same period.

While X is forecast to see ad revenue growth for the first time in four years in 2025, it will still only earn about half of what it did in 2021.

The “Everything App” Vision

The handle marketplace fits into Musk’s broader vision to transform X into a WeChat-style “everything app.” X’s former CEO Linda Yaccarino announced that Visa will be the inaugural partner for “X Money,” which will debut later this year, with features expected to include P2P payments, creator tipping, and cryptocurrency functionality.

Musk has long admired WeChat’s model, stating:

“If you’re in China, it’s basically, you kind of live on WeChat – it does everything. It’s sort of like Twitter, plus PayPal, plus a whole bunch of other things.”

Yet the execution has been pretty challenging. Musk is essentially competing against established giants like Amazon, Uber, Facebook, and Square. These are all companies with hundreds of millions of users and mature payment products.

Underground Market’s Legitimization

For years, coveted usernames have changed hands through shadowy transactions on forums and private channels. Reports from earlier this year revealed that X was planning to allow verified organizations to bid for inactive handles, with starting prices reportedly around $10,000. In 2023, the X Handle team was reportedly looking for buyers for dormant usernames priced around $50,000.

Moreover, by launching an official marketplace, X can capture this revenue directly. X explained on a help page that it’s launching the marketplace

“instead of releasing inactive handles at once for anyone to claim because it wants to prevent bot spam or misuse,” noting that the marketplace “allows for fair and secure distribution through a controlled process.”

What This Means for Users

The marketplace creates a two-tier system where access to desirable handles depends on subscription status and purchasing power. For businesses, creators, and influencers, a clean, memorable handle carries real value. It’s a critical element of brand identity, search visibility, and digital prestige. But that value now comes with a hefty price tag.

Now that means free users are effectively locked out of the marketplace entirely. They must either pay for a Premium subscription to access “Priority” handles or have deep pockets and platform clout to compete for “Rare” handles through invitation-only purchases.

Once a user secures a new handle through the marketplace, X will freeze their old handle so no one else can claim it. However, for those who purchased rare handles, the subscription dependency means they could potentially lose their investment if they can’t maintain the premium status.

The Path Forward

The success of X’s handle marketplace will likely depend on if advertisers return to the platform and if users accept this new level of commercialization. According to current estimates, xAI is on track to generate around $500 million in revenue in 2025, rising to $2 billion in 2026. This indicates X might need support from Musk’s other ventures to remain solvent.

For now, the handle marketplace represents X’s latest attempt to monetize previously free features, hence turning digital identity itself into a commodity. Whether users will embrace this change or rebel against it remains to be seen.