Social media giant, Facebook, recently announced that it would launch its own cryptocurrency, Facebook Coin. The American social media company is now back in the spotlight after reports suggest that it is seeking around $1 billion in funding, for its cryptocurrency project.
According to reports, Facebook’s cryptocurrency would enable WhatsApp users to make faster cross-border payments. The coin will be backed by fiat currencies such as the U.S Dollar and the Euro.
Nathaniel Popper, a Technology reporter at The New York Times, broke the news on Twitter. He tweeted,
“Update on Facebook’s cryptocurrency: Sources tell me that Facebook is now looking to get VC firms to invest in the Facebook cryptocurrency project we reported on earlier this year. I hear they are targeting big sums — as much as $1b.”
He further stated that this “getting outside investors” could benefit Facebook as their cryptocurrency project will come across as a more decentralized platform and “less controlled” by the social media giant, considering the fact that decentralization is one of the “big allures of blockchain projects.”
Additionally, the reporter stated that Facebook was “talking about” using the money raised via the funding round as collateral for its cryptocurrency. Nathaniel Popper added,
“Facebook has been designing the coin to keep a stable value, pegged to a basket of foreign currencies held in bank accounts. It’s interesting to think of one of the richest companies on earth raising money. When was the last time they did outside fundraising?”
Interestingly, Ross Sandler, Barclays’ internet analyst, had recently stated that Facebook’s cryptocurrency project’s estimated additional revenue could be $19 billion by 2021, while the base revenue was estimated to be around $3 billion, upon the successful implementation of the project.
“Based on our checks, the first version of Facebook Coin may be a single purpose coin for micro-payments and domestic p2p money transfer (in-country), very similar to the original credits from 2010 and Venmo today.”