Facebook sparks a fire in the Crypto World

Facebook’s revenue growth is slowing down, the website itself has hit its limit on its number of users, and there is no room for growth there. It is with this particular issue that the company has been trying to diversify, which has led the company to buy up other services like Whatsapp, Instagram, and others. There are many other issues faced by the company as they are unable to monetize Whatsapp, Instagram, and many other services. Also, the privacy scandals have taken a hit on user engagement. This along with the huge fine the company has to pay the world over has put a hole in the company’s profit, and the biggest threat of all, the revenue could see a massive decline as Amazon is taking a bigger share of online ads. Facebook in an effort to diversify and monetize many of its platforms is now developing its own cryptocurrency.

Facebook’s own Bitcoin

Rumors have been running about Facebook’s crypto ambition. This is because the programme is confirmed but there is very public knowledge about it. The company has kept most of the details private, giving rise to a lot of confusions. As of now, Facebook is developing a stable coin which will be used for transactions within their products for a variety of uses including increasing user engagement, payments for in-app purchases and for remittance through Whatsapp, etc. Facebook is also planning to raise capital to back this new coin’s collateral. Right now the company has run a trial on Whatsapp for digital payment but has since run into regulatory trouble. Facebook has been hiring new talent for this ambition for quite some time, first by hiring former PayPal president David Marcus in 2014. Then around 100 engineers were hired in London, who are in addition to those already in Dublin.

It is to be noted that the revenue, as well as profits, have not flat-lined, the company is still a growth company. But it wants to remain so especially in the face of the fact that companies like Amazon and Google are growing. Investors are expecting high growth for a company trading at a 25+ multiple of its EPS (Earning per Share) and recent events are not instilling much confidence among investors. We have to remember that although many big companies have announced crypto projects earlier most of them have not materialized or have been shut down. If Facebook does end up implementing crypto in its platform it will be game-changing for the whole tech industry. First, it will create a super app like WeChat where everything from advertisement to chatting to sale can happen in a single platform. Second, it will create a wave of adoption for crypto. The infrastructure is already there, this could be the final push.
Follow us on Twitter, Facebook, Steemit, and join our Telegram channel for the latest blockchain and cryptocurrency news