Even if it costs $1 to collect that $1 it might be worth it if it creates a 'better' and more engaged user base. If you pay for something you value it more and might end up taking better care of it. The question is if having fewer, but more engaged, users is a net benefit in the long run.
But we know that you'll never get everyone to pay (the If Everyone Gave Me a Dollar fallacy is a thing), and it's still only $500m a year, when they lost $2b+ in advertising, right? And now you have to support multiple micropayments.
I didn't say it makes sense, I am not in a position to judge that given limited knowledge about twitter's finances. I'm just saying that the framing is important