When, Not If, Facebook Coin Comes to Life, It Won’t be the ‘Bitcoin Killer’, It’s Going After the US Dollar
Privacy matters to millions of people across the world. At least 17 million younger Americans have left Facebook in the last two years due to a variety of privacy mishaps.
These issues, along with others, have dealt a significant blow to Facebook’s bottom line. The platform has lost 80% off its market cap in the last year, and owner Mark Zuckerberg has personally lost about $19 billion.
Recently, Zuckerberg outlined in a blog post how the company was going to pivot towards a “privacy-focused future.” He explained how WhatsApp, Instagram, and Facebook Messenger would incorporate end-to-end encryption.
This plan has left some to wonder how the social media giant would make money since private communications don’t really mesh well with publicly broadcasted advertisements. Kik Messenger founder Ted Livingston thinks he has the solution. He believes Facebook is going to create a cryptocurrency “for the physical world.”
Livingstone explained in a recent Medium post how cryptocurrency was the “only good way” to make money “without a feed to put ads in.” He noted how Kik launched the Kin cryptocurrency in 2017, which has been used by 80,000 people last month across 40 apps.
The Kik founder thinks Facebook is going to model the approach that WeChat took to “replace cash” in China.
He argued how if Facebook could leverage blockchain in a manner that could let people send money for free, “it would be a game changer for tens of millions of people.” With blockchain, Facebook could:
“roll out a global financial system without needing to go through the time intensive process of working with banking regulators country by country.”
Then as people remit money inside of Facebook’s platform, the company would add more ways to spend cash, like the ability to pay utility bills and pay for restaurant food.
He thinks this would lead to a situation where “soon enough there will be no reason for anyone to take their money out.”
Facebook has already indicated it will offer stablecoin-powered remittances, and plans to start the process in India, a popular hub for WhatsApp that also is the recipient of the globe’s most remittances for year.
Livingston thinks this could lead to a scenario where “just as WeChat replaced cash in China, Facebook could soon replace cash in India,” and then ‘Facecoin’ could become “the primary currency for billions of people” as is spreads.
He then asks then what would stop Facebook from “doing the same” as when the United States decided to unpeg the U.S. dollar from gold, which led the fiat currency to “replace gold as the world’s reserve currency.”