Those at Wall Street have an ability to ignore the obvious. In the case of Facebook, that implied really examining below daily headlines
Wall Street has been worried about the problems of social media giants with respect to regulators and politicians for the restriction of user privacy violations on Facebook. The firm anticipates losing up to US $3 billion due to possible fines from Federal Trade Commission (FTC).
However, a merger was made to significantly increase its movement toward a new hot field that could easily generate over six times that amount in less than three years. That is a reason why the news published on February 4th is so important to understand Facebook’s true cryptocurrency ambitions.
The firm discretely started a Blockchain project about a year ago. Nevertheless, the recent purchase of Chainspace’s boot chain in February led Facebook to seek the type of scale meant by Big Money.
Facebook’s Cryptocurrency Ambitions
A purchase like Chainspace would actually not attract many headlines as this was not a blockbuster. Facebook has not disclosed the purchase price, but it must have been a pittance as the company only had a few workers.
It must be clear that Facebook bought Chainspace because it wanted to hire the startup’s group of Blockchain geniuses. The main goal of the young company was to make Blockchain technology more scalable.
In its native state Blockchain technology simply cannot scale to handle the billions of transactions seen in payment firms like Visa, MasterCard, PayPal, among others.
That is the reason why Chainspace is Facebook’s secret weapon. With a figure of about 2 billion monthly active users, Facebook has created one of the biggest technological platforms in history.
In a few words, the firm’s new cryptocurrency, “Facecoin”, could turn into a gold mine.
Barclays’ Internet analyst, Ross Sandler, believes that a Facebook currency could yield up to US $19 billion in additional revenue for the social media platform by 2021. The aim is that, like Google, Facebook could generate revenue by charging the company’s users a small fee for using the service.
“Facecoin” for Payments
Facebook has been working on its crypto project, “Project Libra”, for over a year, and has recruited dozens of financial firms and online merchants to help launch it, according to The Wall Street Journal.
It has been reported that Facecoin could become a stable digital currency that would allow people to send payments from one place to another or buy articles on Facebook and all over the Internet.
Facebook has been trying to raise billions of dollars from firms like Visa and MasterCard to support its currency and thus avoid the ups and downs that the regular cryptographic market could have. A key feature of stable currencies is that each of them is often supported in fiat currencies such as the US dollar, which provides more stability.
Now, regardless how exciting this development for the world of cryptographic investment is, buying available Facecoin is not necessarily the way to take advantage of this opportunity. After all, as Mark Zuckerberg states, the main goal of this currency is to maintain the same price over time.
By Willmen Blanco