After Multiple Issues With Privacy And Widespread Blackout This Week, Would Anyone Trust A Facebook Bank?
Facebook is not known for having the best privacy efforts. Last year, they were seen by the federal court to deal with many issues related to the security of their platform, and the global service outage days ago did not do much to improve their reputation. The outage is reportedly the longest one seen in 15 years, and the fact that Facebook had to make the announcement on another social media platform just added insult to injury, says Forbes.
The ironic timing of the outage is that it happened only a week after multiple media outlets suggested that Facebook is working on a secret crypto project to launch their own coin. This rumor has been further perpetuated by the e-money license that the company quietly secured from the Central Bank of Ireland two whole years ago. The license gives them permission to participate in e-money issuing and payment services.
Within the project, it is alleged that the new Facebook Coin will follow the path of WeChat, in that it may be considered a stablecoin. The creators of WeChat have already stated that it will be nearly impossible to replicate their platform, considering that their infrastructure was built in a way that Facebook has not built their own WhatsApp messenger.
Stablecoins are becoming more popular in the crypto industry, as they are pegged directly to fiat currency and have almost no volatility. Volatility has long been the enemy of institutional investors, leading many to hold back on investing in crypto without some security. Still, even with a stablecoin, can Facebook be trusted to engage on the privacy of the blockchain, considering its substantial shortcomings in the past?
According to a survey by Ponemon Institute, there has been a 66% decline in consumer trust in the platform, even before the senate testimony when it was revealed that many senators do not actually understand Facebook. With a major data breach, a substantial loss in trust, demands for regulation by politicians, and the recent outage, reports suggest that Facebook has not been deterred from becoming a crypto bank with its own digital asset. Will you trust a Facebook-based stablecoin?