Facebook Considers Developing Cryptocurrency for WhatsApp Transfers

On Friday, December 21, Bloomberg reported that Facebook is working on a digital currency allowing the users to transfer money through its WhatsApp messaging app. Citing sources familiar with the matter, the publication said that the social media giant will first focus on the remittance market in India considering its huge user-base in the country.

India alone contributes to more than 200 million active users to WhatsApp’s global user-base. Moreover, according to the World Bank, India leads the global remittance market with people sending $69 billion back to the homeland in 2019. 

The sources say that Facebook’s cryptocurrency won’t be driven by demand and supply but instead would be a stable coin pegged to the U.S. Dollar. It looks like Facebook plans to keep itself from the volatile cryptocurrency market that is still ridden with uncertainty, regulatory scrutiny and manipulation.

The sources also said that there are no immediate plans to release the coin in the market, and that the company is still working out the strategy behind the launch. This includes a plan for regular currencies and custody assets that would “that would be held to protect the value of the stablecoin”, writes Bloomberg.

Furthermore, the latest reports suggest that Facebook is on a hiring spree for blockchain engineers currently and has more than 40 people within the company’s core blockchain group. In a statement, the company spokesperson 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.”

Over the last year, Facebook has shown its intentions to explore the blockchain and the cryptocurrency market. Earlier this year in January 2018, Mark Zuckerberg said that he would dedicate his time to study for the cryptocurrency and blockchain market, this year. Also, Zuckerberg pointed that he would study the use of blockchain to fight against the menace of fake news circulated on the platform.

Later in May, Facebook Messenger chief David Marcus was appointed to head the company’s new Blockchain Group. Later on in July, there were reports of Facebook proceeding with making new appointments to its blockchain group. Evan Chang was appointed as the director of engineering and Kevin Weil as the VP of product for the new division.