Wall Street analysts are all getting their tinfoil hats on after Facebook’s estimated launch of its long-awaited cryptocurrency payments system on Tuesday. Various reports correctly predicted that the company is all set on revealing the so-called Project Libra with partners including Visa and Mastercard.
Facebook is leading the FAANG (Facebook, Amazon, Apple, Netflix, and Google) stocks this year and is up over 40% so far this year. If they can withstand all the pressure from government regulators and nail this new crypto project, analysts expect the stocks to skyrocket even further this year.
RBC analyst Mark Mahaney said:
“We believe this may prove to be one of the most important initiatives in the history of the company to unlock new engagement and revenue streams. ”
According to Cointelegraph Brazil reports, South American online marketplace Mercado Libre is reported to be working with Facebook on Project Libra. Mercado Libre has operations in more than 15 different countries and is one of the most popular e-commerce platforms in South America. The cryptocurrency will be integrated into the e-commerce platform as a form of payment.
The company will probably operate as a node in Facebook’s upcoming blockchain network.
Here’s a collection of the different analysts take on Facebook’s potential cryptocurrency launch :
SunTrust – Buy rating
“We believe this is a major initiative for Facebook, and one that has the potential of putting the company front and center in areas beyond advertising, including commerce and financial services, materially expanding its TAM and growth prospects. … It positions the company as one of the key actors at the center of the cryptocurrency development, and the main architect of the future of this emerging and important trend. While cryptocurrencies have existed for several years now, no other company could bring the combination of user scale, brand support and balance sheet, which Facebook can in our opinion. … It reduces the potential for regulatory scrutiny and opposition on anti-trust grounds (especially in the current environment), given Facebook’s consortium approach and the varied nature of the partners.”
Citi- Buy rating
“Multiple reports suggest that Facebook will unveil details of its cryptocurrency effort (dubbed Libra) tomorrow morning via the publication of a whitepaper. The reports suggest that Facebook’s Libra initiative could be one of the most well-organized efforts by a global consumer tech company yet. The currency could have a variety of applications, from P2P money transfer to merchant shopping (including on Instagram Shopping and Facebook Marketplace). As Zuckerberg said at this year’s F8, “sending money should be as easy as sending someone a photo.” Libra could introduce a meaningful new product and profit stream for FB over the coming years. That said, the regulatory framework for cryptocurrencies remains uncertain, and Libra will also be an important test for how well Facebook has been able to (or will be able to) overcome the recent questions about its trustworthiness.”
MoffettNathanson – Buy rating
“We believe a Facebook cryptocurrency-based payments system could be especially useful in countries with high inflation/unstable banking systems and for cross-country remittances. So, Facebook’s commerce ambitions do not appear to be limited to developed markets. Rather, Facebook has its eyes set on becoming the world’s leading e-commerce platform as well.”
RBC – Outperform rating
“We believe this may prove to be one of the most important initiatives in the history of the company to unlock new engagement and revenue streams, and we plan to provide an analysis of the White Paper to help investors analyze the underlying crypto economics of the token. We believe Facebook will use crypto to facilitate a platform for 1) Payments; 2) Commerce, and 3) Applications & Gaming. And we believe this strategy is a multi-step process, starting with a focus on user engagement through messaging and leading to further monetization with each subsequent, deeper step – a similar strategy that has worked well for Facebook’s Core Advertising business.”
Bank of America – Buy rating
“With more than 2.5 billion users, Facebook and its partners could be a significant endorsement of cryptocurrency and notable addition to the Facebook app ecosystem. Although many questions remain on ease of use and potential adoption as there are very viable online payment alternatives in place, the consortium will likely get significant press/visibility and could be a medium-term catalyst for eCommerce activity on Facebook. We see the launch as an important initiative for the company as it builds out a more private messaging ecosystem with eCommerce capabilities.”Follow us on Twitter, Facebook, Steemit, and join our Telegram channel for the latest blockchain and cryptocurrency news
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