Social media giant Facebook has recently denied being in talks with cryptocurrency firm Stellar, shortly after reports suggesting the two were looking into Facebook’s blockchain efforts together emerged.
According to Cheddar, the social media giant issued a statement that denied the report, which was first published by Business Insider. A Facebook spokesperson told Cheddar:
We are not engaged in any discussions with Stellar, and we are not considering building on their technology.
Business Insider’s report cited anonymous sources familiar with the matter, and noted it is “speaking with a number of crypto projects” as it explores blockchain technology. Per the report, Facebook’s blockchain team, led by former PayPal executive David Marcus, met with Stellar to discuss its blockchain efforts.
It further cites a Stellar insider, which told the news outlet that it would make sense for the social media giant to record payments on a blockchain like that of Stellar, which would see merchants connect to it.
Blockchain technology could help the tech company rival the SWIFT Payments network that currently connects the world’s banks, and sees them transfer money to one another. Using a blockchain, Facebook could process payments much faster than the traditional system, at a much lower cost.
The Stellar insider stated:
They'd be taking the rug out from under the banks. They can add a bank more quickly than a bank could build a social network.
Business Insider’s report further added that its sources claimed Facebook and Stellar spoke about the tech giant potentially forking Stellar’s network as part of its blockchain efforts. Stellar was notably launched in 2014, as a payment technology.
Facebook, as CryptoGlobe covered, is reportedly “very serious” about launching its own cryptocurrency, a move that “will take years to materialize.” The company is notably entering the banking sector, as it’s reportedly considering showing users their bank balance, or helping them with fraud alerts.
At press time, according to CryptoCompare data, Stellar’s XLM token is trading at $0.208 after falling 3.6% in the last 24-hour period. It’s currently a top 10 cryptocurrency with a market cap close to $4 billion.
Facebook’s Blockchain Team
While it’s clear Facebook is looking into blockchain technology, it’s hard to gauge just how serious it is. While sources have claimed it’s making a long-term bet on the technology to create a foundation that’ll allow it to “target an array of possible opportunities,” the company itself is secretive about its developments.
Facebook job ads have shown it’s looking to expand its cryptocurrency group, and that it’s hiring a blockchain public policy manager to analyze potential issues and advise its team on related developments.
As Business Insider noted, Shashwat Gupta, a former product manager at Samsung Pay, joined the social media giant’s blockchain team in May, but removed blockchain from its LinkedIn profile after the media started looking into it.