Facebook is talking to venture capital firms to invest in their cryptocurrency project. According to New York Times reporter Nathaniel Popper the social media behemoth wants to raise one billion dollars. He based his speculations on his own anonymous sources.
For several months now, there have been rumors about Facebook launching a cryptocurrency. The company is allegedly working on a cryptocurrency stablecoin that can also be used in Whatsapp. So far, Facebook hasn’t commented on the developments of their blockchain initiative, but the company does have a blockchain division of at least 30 people.
It does feel a bit weird that Facebook is looking for investors into their blockchain project or cryptocurrency. Especially considering that the social media company has over 10 billion dollars in cash at hand. Perhaps the company wants to concept of decentralization also to be part of its funding, but that’s mere speculation.
Another option would be that Facebook needs more money as collateral for its stablecoin. It’s very possible that they want enough cash on hand to back the stablecoin when it launches. Popper stated in a series of tweets that ‘Facebook has been designing the coin to keep a stable value, pegged to a basket of foreign currencies held in bank accounts’.
Currently Facebook has 2.3 billion active monthly users worldwide. Last year the company generated $56 billion revenue with a net profit of 22 billion dollars. That’s more money than all the market cap of all cryptocurrencies, except bitcoin, combined. If Facebook would seriously embrace cryptocurrency and introduce its users to digital money and blockchain technology, it would create a wave of new users the market hasn’t seen before.
Also published on Medium.