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Facebook is reportedly working on developing its own stablecoin, which initially will be focused on the remittances market in India where it will enable users to transfer money via a dollar-pegged cryptocurrency on WhatsApp.
After some resistance to blockchain and nonacceptance of the technology, Facebook, the social networks giant, has got down to developing its blockchain team and is currently looking for fresh talents to welcome to growing blockchain unit. In this regard, there have been rumors about launching Facebook’s own digital currency. They are reportedly true.
Those familiar with the matter have revealed that the company is working on developing a so-called stablecoin, digital currency pegged to the US dollar, that will allow users of the messaging app WhatsApp to transfer money on the platform.
As was reported by Bloomberg, Facebook is far from releasing the coin, as at the moment the company is “working on the strategy, including a plan for custody assets, or regular currencies that would be held to protect the value of the stablecoin.” Moreover, the focus will initially be “on the remittances market in India.”
The government of India is implementing a policy of demonetization and adoption of the blockchain technology. In September this year, mobile banking transactions worth of $6.8 million were processed, which marked a new monthly high. The country also leads the world in remittances. As the World Bank estimated, people sent $69 billion home to India in 2017.
In India, Facebook’s encrypted mobile-messaging app WhatsApp is quite popular, with more than 200 million users. India has 480 million internet users, second only to China. According to Forrester Research Inc., this number is expected to grow to 737 million by 2022. That’s why it is no surprise that Facebook sees tremendous growth opportunity in the country.
When asked for comments, the company was unwilling to confirm or deny its plans to develop a stablecoin. A spokesman said:
“Like many other companies, Facebook is exploring ways to leverage the power of blockchain technology. This new small team is exploring many different applications. We don’t have anything further to share.”
The news has provoked even more speculations about the product Facebook is working on. It is clear, that if launched, Facebook’s stablecoin has a prosperous future. Anthony Pompliano, a cryptoanalyst, founder and partner at Morgan Creek Digital Assets, tweeted:
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
Facebook, which has 2.5 billion global users and more than $40 billion in annual revenue, may become the first large technology company to launch such a project.
The company began making steps in financial services after appointing David Marcus, its former Vice President in charge of Messaging Products, as the head of a new blockchain department. Marcus is also a board member of crypto exchange Coinbase and the former president of PayPal. In June, Facebook appointed Evan Cheng, a senior engineer, as its first blockchain engineering director. Currently, the company is looking for employees with expertise in data science, software engineering, and marketing.