Facebook Inc. is working on creating a cryptocurrency that will allow users to transfer money through the WhatsApp application, focusing primarily on the Indian market. Facebook is still working on a strategy for issuing its own stablecoin, searching for a custodian, and considering methods of storing fiat that will back the coin.
Facebook has long been expected to make a move into financial services after the company hired former PayPal president David Marcus to launch its Messenger app in 2014. In May, Marcus became head of the company's blockchain initiatives department. According to LinkedIn, Facebook's blockchain projects department now employs about 40 people. Like many other companies, Facebook is exploring the possibilities of using distributed ledger technology.
The encrypted mobile messaging app WhatsApp is popular in India and has 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 reported this year.
The past year has seen a boom in crypto projects involving stable coins. At one point, there were more than 120 such projects, according to the website Stable.Report, which tracks stable tokens. The concept of a stablecoin is to be pegged to fiat, which makes the coin less volatile.
Facebook, with 2.5 billion users worldwide, annual revenue of over $40 billion, and extensive experience with regulatory issues, is well positioned to develop a successful stablecoin. It will be the first major technology company to launch such a project.
Facebook sees huge growth opportunity in India as the country has 480 million internet users and that number will rise to 737 million by 2022, according to Forrester Research Inc.
According to https://www.bloomberg.com
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