The European Union has issued its first major penalty under the Digital Services Act (DSA), levying a €120 million fine against X (formerly Twitter) after a two-year investigation revealed multiple transparency violations. The decision marks a significant moment in Europe’s push to hold powerful online platforms accountable for user protection, content integrity, and digital safety.
For X , already under intense scrutiny since Elon Musk’s takeover the sanction represents a major regulatory challenge and a signal that the EU is prepared to enforce its tech rules aggressively.
Understanding the Digital Services Act (DSA): A New Era of Platform Accountability
The Digital Services Act is one of the most ambitious digital regulations ever implemented. It applies sweeping responsibilities to Very Large Online Platforms (VLOPs), platforms with over 45 million EU users including Meta, TikTok, Google, Amazon, and X.
Under the DSA, these platforms must:
- Combat illegal content
- Prevent harmful algorithmic amplification
- Improve advertiser transparency
- Provide researcher access to public platform data
- Audit systemic risks
- Avoid manipulative features (dark patterns)
Failure to comply can result in fines of up to 6% of a company’s global annual revenue, meaning future violations could carry penalties far higher than €120 million.
The Commission’s decision is historic: this is the first formal sanction under the DSA, setting a precedent for how aggressively the EU will enforce its rules moving forward.
What the EU Found: Three Major Transparency Violations by X
The €120 million fine is divided into three parts, each tied to a specific breach. Together, the violations paint a picture of a platform that the EU believes has weakened user trust and obstructed independent scrutiny.
Let’s break down each violation, the EU’s reasoning, and what it means for users.
1. Deceptive Design in X’s Blue Checkmark System (€45 Million Fine)
The Violation
The Commission ruled that X’s “checkmark for payment” model introduced after Musk ended legacy verification constitutes a deceptive design practice.
Before the Musk era, the blue badge identified notable individuals or organizations whose identities had been verified for authenticity. Under the new system, anyone can get the badge by paying a monthly subscription, with no meaningful identity verification required.
Why the EU Says This Is Deceptive
According to regulators:
- Users naturally associate a blue checkmark with authenticity
- The subscription model exploits that expectation
- The design makes it unclear whether an account is trusted or simply paying for visibility
This confusion, the EU argues, undermines users’ ability to evaluate whether content is reliable or an impersonation attempt.
The Risk to Users
The Commission noted increased:
- impersonation
- phishing attempts
- political manipulation
- scam activity
The issue became especially visible during major global events, when fake “verified” accounts impersonated public figures, government agencies, and companies.
2. Failure to Maintain a Functional Advertising Transparency Repository (€35 Million Fine)
The DSA Requirement
Under the DSA, VLOPs must provide:
- a public, searchable database of all ads run on the platform
- information about who paid for each ad
- the target audience
- the period of display
- details relevant to potential political influence
This enables researchers and regulators to track misinformation, covert influence operations, and paid propaganda.
What the EU Found
The Commission said X’s ad repository:
- lacks complete entries
- has serious design flaws
- introduces delays that block real-time analysis
- imposes access barriers for researchers
- fails to meet minimum completeness standards
One official described the repository as “functionally inadequate for transparency purposes.”
Why This Matters
Without a proper ad database, watchdog groups cannot:
- identify political influence campaigns
- analyze suspicious advertiser behavior
- detect scams
- study coordinated manipulation
The EU determined that X’s failures significantly weaken public oversight.
3. Obstructing Researcher Access to Public Data (€40 Million Fine)
The DSA Requirement
The DSA mandates that platforms allow qualified researchers access to public platform data so they can study systemic risks such as:
- election interference
- disinformation campaigns
- hate speech patterns
- algorithmic amplification
- the spread of illegal content
This is essential for external accountability and scientific analysis.
What X Did
According to the Commission, X:
- created “unnecessary barriers”
- denied or ignored valid researcher requests
- restricted access in ways that violate the DSA
- failed to provide tools enabling meaningful public-interest research
Regulators say this prevents independent experts from monitoring threats that could affect democratic processes.
Why Researchers Matter
After Musk’s takeover, X eliminated its public API for most researchers and introduced steep fees. The EU argues that this shift directly violates the DSA and harms digital transparency.
How X Responded and What Happens Next
X will now be required to formally detail how it intends to fix the violations. This includes:
- redesigning the verification system
- repairing the ad transparency database
- enabling researcher access
If X fails to comply, the Commission can initiate:
- further fines
- periodic penalty payments
- additional corrective measures
- expanded investigations
Given that the DSA caps fines at 6% of global revenue, penalties could escalate dramatically.
The company has not issued a detailed public statement yet, but previous comments suggest X views many EU demands as excessive or incompatible with its current operational model.
Why This Case Matters for the Future of Social Media Regulation
This €120 million fine is more than a punishment, it is an early signal of regulatory enforcement power under the new digital framework.
1. The EU is setting a precedent
By targeting X first, the EU is demonstrating that:
- high-profile companies
- influential owners
- or politically sensitive platforms
will not receive special treatment.
2. Transparency is becoming a legal requirement, not a voluntary feature
The DSA is designed to prevent the “black box” era of social media where algorithms, ads, and content decisions are hidden from users and researchers.
3. Other platforms may soon face similar scrutiny
Meta, TikTok, Amazon, Google, and Snapchat are next in line, with investigations already underway.
4. Research and accountability are now core to digital governance
For the first time, platforms must support external researchers not block them.
5. The EU is positioning itself as a global leader in tech regulation
How the X case unfolds may influence future rules in the U.S., U.K., and other regions.
Conclusion: A Landmark Case With Global Implications
The €120 million fine against X marks a defining moment in how governments regulate powerful digital platforms. For the EU, it is a signal that the Digital Services Act is not symbolic—it has teeth, and it will be enforced.
For X, the decision presents a serious regulatory challenge and could reshape its verification, advertising, and transparency policies.
And for users, the case highlights a new era of digital rights, one where platforms are expected to protect authenticity, enable oversight, and operate with far greater openness.
How X responds in the coming months could set the tone for the global future of online platform accountability.
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