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According to reports, Facebook is developing a cryptocurrency that will be used to facilitate the transfer of money on its WhatsApp messaging service.
Bloomberg, citing sources aware of the plans, reported on December 20 that the new token would be sent to the remittance market in India.
According to anonymous sources, Facebook is trying to create a stablecoin, although the exit of the currency will have to wait for the company to complete its plans on the strategy, including the decision on a custody asset.
The development is not surprising, given that the collapse of Facebook in financial services has been widely seen as a foregone conclusion, especially after the social media giant has hired a former PayPal executive to run his Messenger app.
There was also a widespread expectation that the company would take concrete steps in the crypto industry, a perspective that has been strengthened by recent events in the company.
In January, Facebook announced a general ban on cryptographic announcements and ICO promotions on its platform.
The ban was mainly based on the site's desire to protect its users from falling victim "misleading or deceptive promotional practices"Associated with cryptocurrency and initial coin offers.
However, the company's melody seemed to change in May of this year, when David Marcus took over as head of Facebook's blockchain exploration team.
At the time, Marcus said that the main role of the blockchain initiative team would have been "To find out how to make the most of blockchain on Facebook" and that their work would start "from scratch".
At the time, Marcus served on the board of the United States Coinbase exchange platform, but resigned from his position in August from what he cited as a "conflict of interest".
Since then, Facebook has undertaken a series of assumptions, tapping several excellent minds in the blockchain technology sector. A company spokesman told Bloomberg that the team was "exploring many different applications" in the blockchain.
Targeting the Indian remittance market is a significant move for Facebook given the rapidly expanding market of the subcontinent. A World Bank report puts the country's remittance inflows in 2017 at almost $ 69 billion or about 2.8 percent of India's gross domestic product (GDP).
The WhatsApp messaging service is also evaluated in India, with a user base of over 200 million people. The app also saw its rural user base in the country expand over the last year due to a reduction in Internet and data rates.
The Facebook plan for the stovereco sees him enter a section of the cryptocurrency industry that, in recent times, has seen enormous growth and has attracted much interest. There are over 120 projects of this type based on relationships, with Tether (USDT) as the least expensive token, albeit controversial, at a stable price to date.
Other notable stablecoins in the industry are the TrueUSD value of Coin by Circle, the USD Token, the PAX token Gemini Dollar and Paxos of the Winklevoss twins. Worthy of note is that many other encrypted resources supported by it do not make it.
Perhaps the collapse of Basis, a cryptographic project supported by Andreessen Horowitz, shows that the pitfalls abound.
However, Facebook's financial influence and extensive experience with regulatory issues could be factors in the final success of the project.
disavowal: This is not an investment advice. Cryptocurrencies are highly volatile assets and are very risky investments. Do your research and consult an investment professional before investing. Never invest more than you can afford to lose. Never borrow money to invest in cryptocurrencies.
