Facebook has plans to roll out its cryptocurrency. WhatsApp users will be the first to transact using the proposed coin. They will use it to tip each other and run fundraisers. The virtual currency will compete directly with those of the rivals – Line, Telegram and Signal.
According to the New York Times, Facebook started developing the cryptocurrency in secret, last year. Apparently, this happened after Telegram raised $1.7 billion in its ICO.
Implications of a Facebook Centralized Virtual Currency
Facebook has 2.7 billion users between its platforms. They have access to Facebook’s WhatsApp platform, the Messenger and Instagram. All the social media giant has to do is to back its cryptocurrency with actual money. Central banks around the world print money, then back it with foreign currency reserves.
If this happens, Facebook will change the world’s economic history. First, there would be no need for credit cards. This scenario might force Visa and Mastercard out of the market. People would go for a Facebook mobile wallet with coins in it.
There is a myriad of applications that such a cryptocurrency would have. Facebook marketplaces would grow vibrant. Online shopping would become a breeze. The exchange rate spreads will be minimal. Fees will be non-existent. With a charged smartphone, a user would not need to leave the house with a wallet.
The Largest Private Currency Exchange Market in the World
If Facebook plays its cards right, it will become the most prominent private currency exchange market worldwide. Its coin would be the largest holding. More than 2.5 billion netizens will be dealing with it. The coin would indeed succeed where Bitcoin failed.
Another New York Times report said that Facebook’s secret coin project is already underway. Its development team has approached different exchanges, proposing to start selling it to the public.
Like Bitcoin, this new coin would be borderless. The most significant setback that the developers might face is there are heavy regulations in place. Per the New York Times,
The lack of a central authority over cryptocurrencies — a government or a bank — has made them useful to criminals and scammers. The designs of the computer networks that manage them make it hard to handle lots of transactions.
Coin Issuance and ICO
The New York Times estimated that Facebook might deploy the coin by Q1 2019. At this juncture, no one is sure whether the company will hold an ICO. It might make the trading capability available within its flagship apps. Telegram is also planning to release its coin soon. 2019 is bound to be an exciting year for cryptocurrencies.
Do you think Facebook will end up becoming the biggest central bank in the world after the launch of its Facebook coin? Let us know in the comments section below!