Facebook and Libra

Believe it or not, Facebook will be the company that brings cryptocurrency to the masses. Today the social network giant published detailed plans for a cryptocurrency called libra, backed by currencies from the most trusted central banks around the world, and accessible even without a bank account.

Considering that only a few years ago publicly traded companies wouldn’t even mention cryptocurrency in public for fear of startling investors, the fact that one of the largest public companies in the world is creating a new cryptocurrency might seem hard to believe.

But for Facebook, a company that generated $55.8 billion revenue in 2018, almost exclusively by monetizing a shared social network, the push into blockchain, a shared financial network of transactions, represents multiple possible new revenue streams. Ultimately Facebook could reap rewards from financial services it may offer via a new crypto subsidiary called Calibra as well as the income it might generate if its vast customer base parks funds in its reserves backing its new coin.

While top competitors in the cryptocurrency space like Blockchain LLC and Coinbase have fewer than 40 million total users each, Facebook has 2.7 billion monthly active users, giving its cryptocurrency a potential for adoption that competitors can only dream of. While the cumulative market cap of all cryptocurrencies is $290 billion, Facebook’s market cap is almost twice that at $539 billion.

With plans to integrate its own cryptocurrency wallet in with Facebook-owned WhatsApp and Messenger when the cryptocurrency goes live in 2020, Facebook will instantly bridge the world’s largest social network with the brave new world of cryptocurrency. All that’s left is for users to use it.