Currently India-US remittance infrastructure is still primarily dominated by legacy banks, with fintech companies vying for market share growth by offering faster and cheaper alternatives. This is where Facebook sees the potential to undercut existing players and become a leader in this geographic channel.
Let us assume that Facebook’s private cryptocurrency is a stablecoin, called let us say FaceCoin. FaceCoin is likely to be a fiat-backed stable currency at least in the first instance, to keep things simple; check out our analysis on the various types of stablecoins here
. It is very likely going to be pegged to 1 USD, and it can offer instant confirmation leveraging blockchain technology and also charge a very low fee, or even no fee; Remember, Facebook has some experience giving away stuff for free and monetizing data. We are not even talking about borderline grey are, privacy-violating data exploitation here that all the tech giants have in the past been accused of. There is a humongous amount of personal data that can be analysed and dissected in an ‘ethical’, acceptable manner by Facebook. At scale, payment services are likely going the way of checking accounts, with the service providers paying users some interest for the privilege of carrying the float.
Moreover, integrating payments into WhatsApp also puts Facebook along the path of sort-of-peers such as Tencent and Alipay, which have both revolutionized p2p payments by integrating them with instant messaging in China. If the cryptocurrency were to launch globally, it would not be an overstatement to say that Facebook can probably drive more adoption in a few months than what other MoE cryptocurrencies have managed to achieve until now.