With more and more developments being made around the world of cryptocurrency, major organizations throughout the world have started to focus on this game of digital currencies. And following the suit of other companies across the world, Facebook, one of the biggest social media giant of the modern world, might be launching its own cryptocurrency in the near future.
These deductions are being made on the basis of the news regarding the resignation of the Facebook executive David Marcus from the Coinbase’s board. This move might be seen as a strategic move made by Facebook because Marcus will be heading the blockchain development department within Facebook. It is rumored that Facebook will be releasing its own cryptocurrency token in the near future. So, in order to resolve the issue of conflict of interest, Marcus has decided to step down from his position in Coinbase.
Many other organizations have been leading the game of launching their own crypto tokens and it was a matter of time for the social media giant Facebook to join this game and launch its own crypto token based on the blockchain technology. Companies like Kik and Telegram have already launched their own crypto tokens and have raised a lot of investments in this regard through their initial coin offerings (ICOs).
The framework provided by the blockchain deploys the digital distributed ledger technology with all the transactions being made public. Tokens are used by companies to kick-start their own blockchain projects. ICOs are offered by the companies and are bought by investors for the services that are provided later on by the project. Some companies use these tokens to incentivize usage of their platforms. We have an example of Steem, which distributes tokens to its content creators. Rewards are provided to the content creators for posting content on this platform. This can also be seen as a move to overcome Facebook’s rule in the arena of content creating.
Previously, Marcus was the head of Facebook Messenger group at in the organization. Under his leaderships many improvements were made in the platform and major services were added such as video chat, games etc. But in May, he announced his retirement from this position in order to focus on the exploration and usage of the blockchain technology for Facebook. Before this, Mark Zuckerberg had also expressed his inclination towards the usage of blockchain technology in a post. In the post, he expressed his intention of studying about the concepts of decentralized technology and how they can be used for good purposes. As decentralization puts the power in the hands of the people, it fulfills Facebook’s mission of giving power to the people. Mark stated that:
There are important counter-trends to this –like encryption and cryptocurrency — that take power from centralized systems and put it back into people’s hands. But they come with the risk of being harder to control. I’m interested to go deeper and study the positive and negative aspects of these technologies, and how best to use them in our services.
In a nutshell, it seems that this decision is made by Marcus in order to avoid any issues regarding the credibility of Coinbase and conflict of interest. With him being a board member, he could have lobbied the exchange to list a Facebook token which would have been bad for his own reputation and the company’s as well.
As the blockchain technology grows more and more, its usage by Facebook seems to be just the right step taken by the organization. Decentralization might just provide solution to the allegations previously made on Facebook regarding data leak. After weighing the pros and cons of a decentralized framework, Facebook should decide whether the blockchain technology provides the solution it needs regarding data security. There must be some usage of blockchain that the social media giant can find useful.
With all the companies across the world entering the game of cryptocurrency by launching their own tokens, it is high time for Facebook to build its own crypto framework if it does not want to lag behind others in the future.