Reportedly, Facebook is developing a stablecoin for transferring money through WhatsApp in India. According to Bloomberg sourcing from people familiar with the matter, the company is still in the strategic planning phase.
The social media giant has shown intention to expand into financial services since hiring ex-PayPal president David Marcus, now in charge of the Messenger app and blockchain initiative. Regarding this new development, the Facebook spokesperson said: “like many other companies, Facebook is exploring ways to leverage the power of blockchain technology, a new small team is exploring many different applications.” There are namely about 40 employees newly hired to be on the team.
Although the Facebook blockchain initiative has been widely known, and Mark Zuckerberg showed interest in encryption and blockchain through his 2017 New Year’s resolution, little detail is disclosed on WhatsApp’s financial transaction function. Zuckerberg’s cautious choice of creating a stablecoin instead of a regular type of cryptocurrency represents many leading technology companies’ attitude toward digital currency – better to be safe than sorry.
Stablecoin pegged to fiat money or gold, is known for its “stability” compared to the volatile characteristic of general cryptocurrency, especially observed this year. However, there are bitcoin investors who remain skeptical about stablecoin calling it a scandal, while others think it is the future for cryptocurrency. During a sharing session at Mars Finance Global Community on December 5, the famous investor Jeffrey Wernick expressed his view on the stablecoin, saying: “stablecoin backed by fiat is anti-bitcoin” and that “it is only regulatory arbitrage.”
There are over 200 million WhatsApp users in India. Being one of the biggest remittance markets in the world, total overseas remittances into India was around $69 billion in 2017 and expected of over $80 billion in 2018. Therefore, the cryptocurrency payment development in India might prove to be huge, while the country is one of the fastest growing crypto markets in Asia despite the government tightening control and regulation.