Facebook Reportedly Looking for Partners to Launch Crypto-Based Payments System

Facebook has reportedly been in talks with various payment processors, e-commerce merchants, and other financial firms to get them to support a cryptocurrency-based payments system it’s currently developing.

According to the Wall Street Journal, the social media giant has reached out to companies like Visa and MasterCard about the project, which is reportedly known as ‘Project Libra’ in the company. It will reportedly include a blockchain-based cryptocurrency pegged to the value of the US dollar, a stablecoin.

Some of the use cases being considered for Facebook’s stablecoin include allowing its WhatsApp messaging service users to send money to one another, and rewarding users with a fraction of a coin for looking at ads.

The social media giant is also looking to recruit e-commerce firms and apps to accept its cryptocurrency and integrate it as a payment system, in a way similar to how websites and apps currently use Facebook to let users log-in.

The firm has been acquiring blockchain startups for months now, and it’s well-known it has a team working with blockchain technology. While Facebook hasn’t officially confirmed it is launching a cryptocurrency, previous reports suggested it already contacted crypto exchanges about listing it.

To support its stablecoin-based payments network, Facebook is said to be looking for up to $1 billion in investments as collateral. Analysts have estimated Facebook could bring in as much as $19 billion until 2021 thanks to the launch of a cryptocurrency.

Recently, the social media giant announced a major shift to focus on privacy, with CEO Mark Zuckerberg revealed payments and private commerce are going to be an important part of Facebook’s future.

Some believe that if e-commerce takes off on Facebook’s various platforms, it could see brands spend more on advertisements with it, and consequently increase revenue. New revenue streams may also be created if users adopt its payments features.

Henry Liu, a former Facebook employee and a managing partner at a blockchain investment firm, was quoted as saying:

Payments and commerce are Facebook’s only way out from its freemium, advertisement business model.

Notably Gavin Baker, a former Fidelity Investments portfolio manager, has in the past stated he believes Facebook’s stablecoin will likely be a “serious threat” to companies like Visa and MasterCard. This, as the social media giant doesn’t need to monetize transactions by charging a processing fee.

Crypto-Friendly Digital Bank Revolut Raises $500 Million at $5.5 Billion Valuation

Francisco Memoria

The cryptocurrency-friendly digital bank Revolut has raised $500 million in a Series D round of funding that’s valuing the company at $5.5 billion. Over the years, Revolut raised $836 million.

According to TechCrunch, the venture capital firm TCV is leading the round and other existing investors are also participating in it. Revolut hasn’t shared the names of these firms, but DST Global, Index Ventures, and Balderton Capital have all invested in the firm.

Revolut is a digital bank that’s seemingly looking to help replace traditional bank accounts with an app that helps users manage their finances. Using the Revolut app it’s possible to send, spend, and receive money. It also issues a debit card for its users.

The fintech firm has added various features, including the ability to buy stocks or invest in cryptocurrencies. In March 2019, as CryptoGlobe reported, it started offering stop orders for trading major cryptos like BTC, ETH, XRP, LTC, and BCH.

The $500 million are set to be used to improve the user experience for Revolut’s 10 million users, as well as its revenue. Specifically, the digital bank is looking to offer its users lending services, and it has already started doing so as in the U.K. it offers savings vaults. Nik Storonsky, Revolut’s co-founder and CEO, said:

Going forward, our focus is on rolling-out banking operations in Europe, increasing the number of people who use Revolut as their daily account, and striving towards profitability.

While the firm doesn’t share specific number when it comes to its transaction volumes or customers, TechCrunch reports its number of users grew by 169% in 2019, while daily active customers grew by 380% in the same period.

Revolut is currently available in the U.K., Europe, Singapore, and Australia. It’s focusing on launching in the U.S. and Japan.

Featured image via Pixabay.