Last year May, Facebook went through a major executive shakeup, which resulted in many executives taking on new roles and responsibilities. One specific change of role that is of importance here is the news that Facebook Messenger executive David Marcus will now run the newly created blockchain team focus on the utilization of blockchain within Facebook.
What are the prospects the investigation of Blockchain by Facebook can yield? Given the background of the new chief of the blockchain team, Marcus whose former role was as the president of the e-payment platform ‘PayPal’ just before he joined the Facebook team. Apart from Facebook, another notable social media giant attempting to dive into the crypto world is Telegram, with its crypto project reportedly near completion.
Marcus previous engagement prior to the changing of roles was working on converting Messenger into the next star of digital shopping and business transaction, however, his efforts have not been yielding the desired result prompting the shift of focus to blockchain technology.
How will that pan out for the social media giant?
We may be closer to finding an answer- from reports coming out of The New York Times, the tech giant is making plans for new crypto that will give users the option of sending and receiving money from friends, paving way for a global payment system. Going by the report:
“The company is working on a coin that users of WhatsApp, which Facebook owns, could send to friends and family instantly, said five people briefed on the effort who spoke on the condition of anonymity because of confidentiality agreements.”
This report points out the payment system been developed by Facebook will be quite similar in functionality to that of China-based WeChat, that allows its users to buy a large variety of items using the app. The idea is to also make it easier to make a transaction between countries, which can come in handy in the developing part of the world, where it is most time difficult to open new bank accounts or make an online purchase.
Furthermore, we could see a more ‘borderless’ on-platform economy arising from a committed Facebook cryptocurrency, in which anybody, from any part of the world, could perform a transaction with ease and make a quick online purchase, brought about by the peer-to-peer exchange. It could also extend to business transactions, although the original plan to focus on simple user exchange would make the systems development process easier and the building its payment network, free from the additional burden of exchange costs and external regulation.
However, this is without concerns- as pointed out by The New York Times:
“The lack of central authority over cryptocurrencies – a government or bank – has made them useful to criminals and scammers, and the designs of the computer networks that manage them make it hard to handle significant numbers of transactions.”
The extent to which Facebook will have its cryptocurrency decentralized remain unknown, it is possible Facebook could also face the same issue of regulations and technological limitation that popular cryptocurrency such Bitcoin, Ethereum, Litecoin, etc. are facing. Besides this, there is also the issue of security and abuse, relentless attack by hackers has plagued the cryptocurrency world in recent times. How Facebook will countermeasure all these hurdles remain to be seen but this will be something which Facebook will have looked into to come up with the adequate and effective strategy to overcome.
Without a doubt, Facebook can push its own cryptocurrency to the public but concerns such the one above will still surface despite Facebook’s brand popularity. Additionally, with the controversies surrounding Facebook of late such as the privacy violation and data scandal, brand popularity may not be of much help at this given point in time. However, the social media giant will certainly have put this into consideration and will be devising ways to use cryptocurrency to boost on-platform trading and money transaction.
Nevertheless, if Facebook can become successful in its cryptocurrency effort, that could have a major impact on businesses through expansion of opportunities that arises from the development of simple Facebook payment systems. With this, we could see the smallest of operating taping into the global markets with their products and services. Although, we are still anticipating how all these will work out, notwithstanding, it might prove to be what changes people’s view of WhatsApp and Messenger, turning them into crucial apps for conducting a diverse range of daily activities and functions.
Even thou, Facebook is yet to reveal any particular details, we are all buzzing to see what will come out of this project after nearly a year of development. Stay tuned for more updates.