Facebook is reportedly working on a cryptocurrency- a stablecoin.
Reports say that the stablecoin will allow users of WhatsApp, the largest messaging service in the world, to send and receive money. Bloomberg reported this news, citing people familiar with the matter. WhatsApp, which was bought by the social network giant in 2014, has been one of the significant products of Facebook.
Commenting on this recent news on Twitter, the founder & partner at Morgan Creek Digital, Anthony Pompliano, said it would be a great one for the ecosystem.
If Facebook launches the stablecoin they are reportedly building, it will quickly become the most used product in crypto.
WhatsApp has over 200,000,000 users in India alone.
The Indian government has been fighting crypto too so things are about to get very, very interesting…
— Pomp 🌪 (@APompliano) December 21, 2018
The initial focus of this development would be the remittances market in India, the report says. Also, the cryptocurrency would be a stablecoin — a cryptocurrency which has its value pegged to some a real-world asset, such as the U.S. dollar.
Emergence of Stablecoins
Stablecoins have become popular in the crypto-niche in 2018, as prices of other digital assets have been falling. They seek to solve one essential issue that prevents Bitcoin and other major cryptocurrencies being usable for payments and microtransactions: volatility. Some of the stablecoins that have launched this year include TrustToken’s TrueUSD and Coinbase’s USDC.
Also, since stablecoins are not volatile, Facebook’s plans to use a cryptocurrency for the booming remittances market in India, which according to the World Bank was worth $69 billion in April, makes sense.
Facebook has been building a blockchain team in the background throughout the year. On May 8, Head of Facebook Messenger David Marcus said he was changing jobs so he could set up a “small group to explore how to best leverage Blockchain across Facebook, starting from scratch.”
In 2017, messaging service Kik also announced its cryptocurrency called Kin. The idea was to use it for transactions within the messaging service platform. Earlier this month, the company put Kin to use with a tipping feature. However, the functionality is only available for select users. In other optimistic news about the crypto-space, Anthony Pompliano also said that
Two members of the House of Representatives are introducing a bill to exclude cryptocurrencies from the SEC’s definition of securities.
That might ensure that cryptocurrencies do not define by the laws that govern the exchange of securities.
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