It's a centralized stable coin built by Facebook, so it's basically PayPal?
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Facebook Is Developing a Cryptocurrency for WhatsApp Transfers, Sources Say
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Re: Facebook Is Developing a Cryptocurrency for WhatsApp Transfers, Sources Say
#12this make zero sense. are they going to let anyone mine the coins? probably not. if its just them mining it, then its totally pointless.
On the contrary. If facebook controls minting the coins but can't control transactions using the coins, it'd be perfect, much better than the decentralized cryptocoins we have today. It would instantly bypass state controls on money transmission.
They'd probably run into trouble cashing out their coins in that case, though.
Re: Facebook Is Developing a Cryptocurrency for WhatsApp Transfers, Sources Say
#13this make zero sense. are they going to let anyone mine the coins? probably not. if its just them mining it, then its totally pointless.
On the contrary. If facebook controls minting the coins but can't control transactions using the coins, it'd be perfect, much better than the decentralized cryptocoins we have today. It would instantly bypass state controls on money transmission. They'd probably run into trouble cashing out their coins in that case, though.
If facebook controls the mining, then they have the power to change the blockchain, which in effect would defeat the whole point. They effectively have a database with some very unnecessary complexity. It wouldn't bypass state controls because they would still need to abide by laws.
Re: Facebook Is Developing a Cryptocurrency for WhatsApp Transfers, Sources Say
#14Earlier quoted context omitted.
On the contrary. If facebook controls minting the coins but can't control transactions using the coins, it'd be perfect, much better than the decentralized cryptocoins we have today. It would instantly bypass state controls on money transmission. They'd probably run into trouble cashing out their coins in that case, though.
If facebook controls the mining, then they have the power to change the blockchain, which in effect would defeat the whole point. They effectively have a database with some very unnecessary complexity. It wouldn't bypass state controls because they would still need to abide by laws.
I don't think the purpose is to create their own money, but to create a vehicle that takes advantage of crypocurrency-like protocols.
For example, perhaps they'll let users generate their own keys, thereby letting everyone transact freely with each other. This may allow FB to wash their hands of KYC laws except for those depositing and withdrawing fiat directly.
Re: Facebook Is Developing a Cryptocurrency for WhatsApp Transfers, Sources Say
#15Pretty interesting, Facebook generally does not have a reputation for 'jumping on the bandwagon' so I assume they have thought this through. Many of their whatsapp users live in very poor areas that are not traditionally served by banks. If they integrate a wallet into the app it may allow for a real use case. They would still need to provide some sort of 'convert to fiat' functionality for those same unbanked users…
> Many of their whatsapp users live in very poor areas that are not traditionally served by banks.
Bingo. Remittances are still expensive. Basic bank accounts are still out of reach for many.
Any user with cash could become a convert-to-fiat provider.
Before Western Union had to signup shops, now you can go through your friend lists to find someone you already know and trust.
Re: Facebook Is Developing a Cryptocurrency for WhatsApp Transfers, Sources Say
#16It's a centralized stable coin built by Facebook, so it's basically PayPal?
Sounds like easy bolt-on growth.
Paypal is still expensive and uncommon for person to person transactions in real life.
Re: Facebook Is Developing a Cryptocurrency for WhatsApp Transfers, Sources Say
#17Call it a “cryptocurrency” if that makes it sound sexy, but this is still centralized — it’s effectively the same as the (already existing) Messenger Payments.
TBH at this point I have more trust in a centralized cryptocurrency backed by a large corporation than in a decentralized one.
Re: Facebook Is Developing a Cryptocurrency for WhatsApp Transfers, Sources Say
#18Call it a “cryptocurrency” if that makes it sound sexy, but this is still centralized — it’s effectively the same as the (already existing) Messenger Payments.
TBH at this point I have more trust in a centralized cryptocurrency backed by a large corporation than in a decentralized one.
A centralized cryptocurrency is just digital currency. It may be cryptographically secured against unauthorized transfers/access, but if it doesn't employ some sort of game-theory based custodial sharing scheme which is intended to incentivize decentralization of control (successfully our not), it's not using the 'crypto' protection in the special sense that cryptocurrency implies.
Re: Facebook Is Developing a Cryptocurrency for WhatsApp Transfers, Sources Say
#19Why can't they just use a good old database, to record transactions? It is a centralized system! I guess Facebook trusts itself!
Re: Facebook Is Developing a Cryptocurrency for WhatsApp Transfers, Sources Say
#20If this allows Facebook to monetize WhatsApp without introducing ads and the privacy corrosion they would bring, then this would be a very good development.
If Facebook becomes a bank, they will be required to comply with fincen. E2E encryption is not going to fly.