LOS ANGELES — Following widespread criticism over its advertising and privacy practices that have consumers reeling and Congress investigating the company’s potential impact on recent elections in the face of Russian manipulation of the world’s most popular social media platform, Facebook now has its sights set directly on your pocketbook, with plans for an upcoming “Facecoin” and digital wallet service.
Bringing together senior players from the fintech world, the company is rolling out its own blockchain division in response to CEO Mark Zuckerberg’s desire to more fully explore “the positive and negative aspects of” cryptocurrencies.
Former PayPal CEO David Marcus, recently Facebook’s VP of Messaging Products, is said to be helming the new initiative. Marcus is no stranger to crypto, serving on the board of Coinbase, a popular bitcoin exchange, and will be joined by Instagram Product Vice Presiden Kevin Weil, along with a small team, to find solutions for Facebook.
“After nearly four unbelievably rewarding years leading Messenger, I have decided it was time for me to take on a new challenge,” Marcus says. “I’m setting up a small group to explore how to best leverage Blockchain across Facebook, starting from scratch.”
The company has its work cut out for it, not only on the technology front, but on the trust front, where its recent scandals that have already put it under the microscope of lawmakers are sure to cause even more governmental scrutiny as it moves into essentially becoming the world’s largest financial system.
Regardless of regulator action, don’t look for Facecoin too soon — or as an IPO.
“Payments using crypto right now is just very expensive, super slow, so the various communities running the different blockchains and the different assets need to fix all the issues,” Marcus says. “Then when we get there someday, maybe we’ll do something.”
A video report from Cheddar’s Alex Heath provides more details here.
While early indicators point to a captive ecosystem where Facecoin would be used for payments from consumers to the site’s advertisers for the purchase of products and services, adult merchants, which are prohibited from the platform, may benefit tangentially from the increased crypto awareness that a company such as Facebook can drive.
On Wednesday, May 30, from noon until 12:50 p.m., the upcoming XBIZ Miami industry showcase will feature an executive session debating traditional credit card transactions versus cryptocurrency use, where the top players in billing and adult crypto will dissect the pros and cons of each — a must attend session for adult merchants wondering where they fit into all of this.