Facebook is reportedly working on making a cryptocurrency that will let users transfer money on its WhatsApp messaging app, focusing first on the remittances market in India, according to a report from Bloomberg.
The story said, “The company is developing a stablecoin — a type of digital currency pegged to the U.S. dollar — to minimize volatility, said the people, who asked not to be identified discussing internal plans.
“Facebook is far from releasing the coin, because it’s still working on the strategy, including a plan for custody assets, or regular currencies that would be held to protect the value of the stablecoin, the people said.
“Facebook has long been expected to make a move in financial services, after hiring former PayPal president David Marcus to run its Messenger app in 2014. In May, Marcus became the head of the company’s blockchain initiatives, which haven’t been discussed publicly in detail. Facebook has been on a hiring spree, and now has about 40 people in its blockchain group, according to employee titles on LinkedIn.
“WhatsApp, the company’s encrypted mobile-messaging app, is popular in India, with more than 200 million users. The country also leads the world in remittances — people sent $69 billion home to India in 2017, the World Bank said this year.
“Facebook, which has 2.5 billion global users, more than $40 billion in annual revenue and greater experience navigating regulatory issues, may have a better chance of making a stablecoin that sticks. It would be the first large technology company to launch such a project.”
Meanwhile, the Independent reports that, “Facebook has been recruiting heavily for its secretive blockchain project, suggesting the social network is moving forward with plans to launch its own cryptocurrency.
“The hiring spree comes a few months after one of the biggest management reshuffles in Facebook’s history, which saw former PayPal president David Marcus appointed the lead of an exploratory blockchain group.
“With around 2.2 billion monthly active users on its social network, together with billions of users across WhatsApp and Instagram, Facebook has the platform reach to introduce the world’s first mass market cryptocurrency.
“Facebook is yet to provide any further details about the project, following several requests from The Independent.”
“‘Like many other companies Facebook is exploring ways to leverage the power of blockchain technology,’ a Facebook spokesperson said. “This new small team is exploring many different applications. We don’t have anything further to share.”
If Facebook, a social media giant which also owns WhatsApp and Instagram, were to make a foray into the digital currency genre it could stand to impact the fintech industry due to the association of one of the world’s largest and most successful tech companies entering the genre.
The Bermuda Government has been actively seeking to build a fintech industry on the island, with Premier David Burt recently saying that while he is not “holding this out to be a third economic pillar” he believes fintech “can serve as an enhancement to what we’re doing in financial services and make sure that we can continue to innovate and lead in the area of being an international financial services jurisdiction.”