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Facebook dives into crypto — Acqui-hires Chainspace employees


Crypto trend


This week Facebook made headlines when it acqui-hired a majority of the employees at Chainspace, a Blockchain startup founded by researchers at University College of London, according to a InWara’s M&A database.


Facebook has been observed to be, aggressively hiring experts in Blockchain and crypto space. Facebook intends on leveraging these experts to explore applications for the still nascent Blockchain technology. As a Facebook spokesperson was quoted saying “Like many other companies, Facebook is exploring ways to leverage the power of blockchain technology. This new small team is exploring many different applications. We don’t have anything further to share.” also adding “Our ultimate goal is to help billions of people with access to things they don’t have now — that could be things like healthcare, equitable financial services, or new ways to save or share information.”


Chainspace is a decentralized infrastructure according to the firm’s academic white paper, published in August 2017. Its whitepaper further explains the technology backing the infrastructure such as S-BAC, a distributed commit protocol, that supports smart contracts. Chainspace also claims its technology is also secure from any tampering on or off its network, as it uses high-auditability, Blockchain techniques such as Byzantine Fault Tolerance (BFT).


Social media revamped by Blockchain? 


Facebook needs no introduction, the American social media behemoth had 2.2 billion monthly active users as of January 2018. Also, Facebook is hardly the first social media company to flirt with the idea of leveraging Blockchain and crypto.


Earlier a Canadian messaging platform Kik had raised capital through an Initial Coin Offering-ICO. Kik later revealed plans of integrating Its native Kin token, with the Kik messaging platform, to allow users to tip public group admins. Kin tokens can also be used in a multitude of mobile apps available on Google Play and iOS App Stores Kik recently made headlines for its stint with the SEC, that escalated to the point where the SEC may even serve Kik a ‘cease and desist’ order. To know more about why Kik is in trouble with the SEC check out InWara’s article.


Presently, all social media platforms are plagued with security risks, because these platforms run on an ad-revenue basis and this has lead to users privacy being invaded several times. Also the centralized nature of data storage by social media platforms has lead to several data breaches, this could be by leveraging a decentralized network like Blockchain. To know more about how Blockchain could revolutionize social media check out InWara’s article.


Funds raised ($MM) by various sectors

Source: InWara’s ICO+STO database


Social media companies that are leveraging Blockchain technology to fuel the growth of social media 2.0 are among the most lucrative in the crypto space. With as much as $1.9 billion being raised collectively by these enterprises till date, according to InWara’s ICO+STO database. This sector is in the top five industries sectors in the crypto market space, indicating the sheer potential for growth.


Facebook to introduce stablecoin for Whatsapp?


At the beginning of 2018, Facebook-owned messaging platform, Whatsapp introduced its in-app payment feature in India, by linking it with the country’s Unified Payment Interface (UPI). This features enabled users to send fiat currency directly to other users without any transaction costs. Months later, Facebook announced plans of introducing a stablecoin on Whatsapp platform. 


A stablecoin is a type of cryptocurrency that is pegged to the US dollar, which minimizes the volatility of the coin, hence monikered ‘stable’. Although still in its nascent stages Facebook hopes to target the Indian remittances market with the introduction of cryptocurrency into Whatsapp. Indians sent home $69 billion dollars in 2017 according to a Bloomberg report. In the current financial system, it takes days for a person to send money cross-borders into another country, and there are high transaction fees, Facebook may be hoping to replace this system.


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