I genuinely think Elon worked out that large numbers of people were repulsed by the paid-only blue check population and that ways to ignore/hide them entirely were right on the horizon. So he started giving back blue checks to people and orgs of his own choosing to prevent that.

And of course in the process, turned the blue check into exactly what he originally complained it was: a badge of privilege for a selected elite rather than a relatively even-handed to way protect users at risk of impersonation. Which latter purpose he never even acknowledged.