By Michael K Spencer
Project Libra is a very interesting project by Facebook in its pivot to the monetization of encrypted chat and it’s walled garden social and attention architecture. So here’s the crazy part about Facebook’s internal “stablecoin” that will help monetize WhatsApp, which has more active users than both Instagram and Messenger.
Project Libra Sounds a Lot like the Crypto Version of PayPal
Facebook’s crypto project echoes board member Peter Thiel’s original vision for PayPal. It’s so clear to me, with Facebook hiring PayPal people to implement this. If Facebook succeeds in scaling its blockchain payments project to its more than 2 billion users, the company will deliver on Peter Thiel’s original vision of online payments.
$19 Billion Opportunity
According to Barclays, Facebook’s cryptocurrency could be a $19 billion revenue opportunity.
Facebook’s much-hyped cryptocurrency project, dubbed Project Libra, may launch in India within a matter of months, according to a Bloomberg report. The future of the company might be less Instagram than you think and more WhatsApp. This is because how mainstream WhatsApp is in places like India and South America.
As Messenger, WhatsApp and other channels are merged, exchanging an internal stablecoin and connecting with businesses is just an epic opportunity for the future of advertising and the future of payments globally.
There’s no mystery in how mass-adoption could take place. Facebook says it’s blockchain, but it sounds a lot more like a cryptocurrency. The sort of thing it was banning Ads for not too long ago.
Project Libra is essentially Facebook’s late and limited attempt to become like WeChat. Facebook’s family of apps is so far from providing the super-app quality of Chinese apps, it shows just how far behind Silicon Valley are in terms of actual consumer-centric innovation in apps. “Mini-Programs” are totally missing from Facebook, Google and Amazon’s playbook, and it shows a wide discrepancy in how Chinese innovation is outsmarting them.
For the PayPal analogy, however, payments will (not could) help Facebook develop an entirely new revenue stream aside from advertising — something “sorely needed at this stage of the company’s narrative,” says Barclays internet analyst Ross Sandler on CNBC.
A Project Libra stablecoin isn’t decentralized however, it’s just another centralized digital currency without aspects of real cryptocurrencies. It’s not Bitcoin, but Facebook can get it regulated and essentially become like a global bank and peer-to-peer system which will make Venmo, Square’s Cash App, Zelle and maybe even WeChat look small in comparison. It could realistically one day disrupt Apple Pay and yes, Paypal itself.
Facebook might be the crypto version of Paypal without needing to behave like crypto but rather a real digital currency and asset that’s blockchain based without being controversial and volatile. Project Libra has a good chance of succeeding for these reasons. It does add the next level of convenience for the arriving “token economy.”
Facebook’s Project Libra will likely be the play before they acquire Coinbase. Think about to what Paypal was envisioned as. “Every one of your friends will become like a virtual, miniature ATM,” Thiel told Wired in 1999. Facebook’s blockchain project is of course led by former PayPal president David Marcus, and reportedly includes a number of other former PayPal executives.
Now that Facebook has acquired 2 billion users it has to learn how to monetize them without just relying on super-successful digital advertising. That’s how Facebook remains a generational company, though realistically it will mean Paypal, Square and many others could be under threat.
The entire future of crypto could be disrupted by this, a centralized solution making decentralization a distant dream of young people who have no clue how the real world (Wall Street, Finance, Global Economics, B2B Enterprise solutions, Cloud) works.