Facebook To Launch Cryptocurrency for WhatsApp

The digital market is growing year on year, with new technologies expanding the capabilities of what is possible to accomplish online. All eyes are focused on the world’s leading tech and finance giants to see where the space is headed.

There have been some big rumours doing the round regarding Facebook and their affiliated company, WhatsApp. Rumour has it they are set to revolutionise blockchain utilisation by making it the in-app currency for WhatsApp and its over 2 billion users. These are not baseless rumours, but rather educated assessments based on what has been going on at the mother company over the past several months.

Blockchain has been around for some years now, but has missed major adoption as none of the leading tech companies have truly tested its capabilities. With Facebook and WhatsApp pushing these boundaries we could see world trade follow suit and embrace cryptocurrency.

CHANGE OF HEART OR MAJOR DECEPTION?

In early 2018, Facebook issued a blanket ban on all things regarding Bitcoin and cryptocurrency. Due to some bad actors in the social media space relating to crypto Facebook discontinued support of advertising and articles placements on this subject altogether.

Within the year however Facebook did a 180 and suddenly began allowing Bitcoin talk back onto the platform. This already had the sceptics interested in the motives behind such a drastic change of policy. When Facebook started a hiring spree on their website for specialists in the Cryptocurrency market their motivations suddenly became crystal clear.

Some of the positions they advertised were:

  • Blockchain Data Scientists
  • Blockchain Data Engineers
  • Blockchain Software Engineers
  • Blockchain Marketing Head

The evidence is quite overwhelming, and the only reasonable suggestion is that they must be working on something big.

WHATSAPP: YOUR HELPFUL CRYPTO WALLET?

Bloomberg reports that Facebook initial focus for this new crypto will be those looking to send funds abroad.

Testing should roll out in India first, which is both the leading WhatsApp and Facebook user group in the world. It is also one the largest remittance markets on the planet with annual remittances into India exceeding $70 million in recent years. Facebook will be the largest tech company in the world to test the viability of a stablecoin cryptocurrency while also already having a built-in user base with which to launch their product. This monumental potential user base could be the tipping point in their success.

One thing we know is: If a tech company of this size starts to actively pursue blockchain integration then the rest of the tech and business world won’t be too far behind. Could this be the start of a Bitcoin revolution?

STABLECOIN AND ITS POWER IN THE HANDS OF A GIANT

Stablecoin is a type of cryptocurrency that ties its value to the US dollar. Because it does this, it proves to be relatively stable when compared to standard cryptocurrencies. This makes it far easier to trade on the open market as its value is far more resilient, and suffers smaller variations in its highs and lows. As such it will have greater market appeal, and perhaps even draw in new business from new untapped verticals.

A Facebook stablecoin through WhatsApp, would be a direct competitor for Direct Cash payments. The blockchain offers superior record keeping, offers faster processing, costs less per transaction, is not subject to taxation, and providers greater privacy protection. With the correct implementation and broad base adoption this could be the beginning of the end for old fashioned cash transactions.

Bitcoin analysts foresee great potential for expansion in the retail industry, service industry, and even greater growth in the online gambling sector.

1. Online Retail Industry

This industry involves the selling of goods online. It requires that a currency be a little more stable, or else the sellers will constantly be updating their costs to suit the value of a cryptocurrency that could change daily. For this reason, stablecoin would be a far better currency to use on such platforms.

Being able to message stores and receive invoices on WhatsApp and then fulfil payment by the same means, will prove very convenient to consumers. WhatsApp become the communication app of choice for billions of people world wide, leveraging this trust could see them easily become the cryptocurrency retails app of choice as well.

Payments for products could take place ‘on the go’ and in record time, as crypto transactions do suffer from the delays and tedious verification processes of traditional banks. With no middlemen profiteering off the consumer overall transaction costs are noticeably lower, and without the need for Forex conversions there are no surprise, or even worse fluctuating, fees.

With the backing of a mega-corporation like Facebook smaller businesses are more likely to dip their proverbial toes in the virtual currency market as well. This will lead to a truly open market economy where location and currency valuation no longer stifle startups and encourages greater competition.

2. Online Service Industry

Online services often involve software products, IT services, web hosting and more recently specialised services like content writing and virtual assistants. Much like the retail sector, services can be carried out in real time, and payment for these services can be remitted within seconds via the blockchain. It also revolutionises the COD payment concept. Once the service is carried out, a WhatsApp payment can be made and reflect in an instant.

In fact this new in-hand blockchain transacting opens up the door to any type of service. Need a plumber? Once the job is done he sends you an invoice and with the click of a button you’re able to process payment via your WhatsApp app – all before he’s packed up his tools.

With instant payment capabilities, more and more service companies may enjoy safe and secure payments. It all needs a leader to ‘get going’. We see no other better company to lead the way, than Facebook.

3. Online Gambling Industry

Cryptocurrency online gambling is already a multi-million dollar industry. A more stable punted cryptocurrency could provide a more consistent revenue base for Bitcoin casinos. Stablecoin would lessen the risk involved in this regard as the crypto value would fluctuate less radically allowing the casinos to become even more generous with the promotions and gifts.

With the boost Facebook’s involvement would give cryptocurrency adoption it is reasonable to project that more gamblers would sign up with Bitcoin casinos as it becomes more mainstream for them to transact with cryptocurrency. No matter how the wind blows on this topic it will benefit the gambling sector.

ANY FORESEEABLE GROWTH ISSUES?

Crypto currencies are susceptible to scalability issues. Should Facebook join the cryptocurrency world, thus truly punting the popularity of Bitcoin and the like, we could find ourselves with issues relating to limits around how many transactions a specific cryptocurrency can process and the amount of coins which can be mined.

Fortunately, Bitcoin has already began the process of addressing this need for smaller high volume transaction with the creation of its Lightning Network.

This is whats known in tech speak as a Layer 2 software product, which means it uses the blockchain as its foundation but actually runs on top of it. In simple terms there are nodes which allow for financial transaction to be processed through them. A transaction can pass between several of these nodes when retailer and a consumer transact with one another. These nodes have no knowledge of who the original sender or receiver of the funds are. They also only write their final transaction logs to the blockchain when they close, and not after every minor action as they would have to on the base blockchain. These two items alone make Lightning Network transaction speedy and incredibly secure.

This technology will go a long way to solving the scalability issues and make exponential market growth a reality.

SHOULD WE WAIT FOR ANNOUNCEMENT?

Why wait? Though an announcement is imminent, it could be a while before Facebook officially roll it out on a global scale. With all the benefits of Bitcoin available to you right now the smart money says to board the crypto-train now, and be ahead of the pack.

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