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Facebook: ‘Biggest on-Ramp Ever’ for Bitcoin Adoption?

Last Updated March 4, 2021 2:31 PM
P. H. Madore
Last Updated March 4, 2021 2:31 PM

By CCN.com: Spencer Bogart, a partner at crypto investment firm Blockchain Capital, argued in a new blog post  that over the next two years Facebook, Telegram, and stablecoins will create the largest on-ramps to crypto that the Bitcoin industry has ever seen.

Facebook & Telegram Could Fuel Rabid Crypto Expansion

With the on-boarding of two of the largest networks in the world – Facebook and Telegram – the crypto economy is likely to grow a great deal in the coming few years. Regardless of whether these platforms are integrating Bitcoin directly, all cryptos will be in higher demand as a result. Further, more people than ever will be familiar with the ability to send money quickly and cheaply using blockchain technology. Bogart says:

“It’s a virtuous cycle: As more users onboard to crypto, more developers build more incredible things to do with programmable money which drives more users and more capital to the industry. The net result is more growth. And a lot of it.”

facebook whatsapp cryptocurrency
Facebook is said to have already contacted Bitcoin exchanges about helping it issue its WhatsApp cryptocurrency. | Source: REUTERS / Dado Ruvic

While the Telegram Open Network token and Facebook cryptocurrency are likely to be the “gateway drug” for many people, once they get exposed to crypto, they’ll have the ability to trade these tokens for more established cryptocurrencies like Bitcoin, Ethereum, or Tron, depending on what they’re interested in doing in the blockchain world.

“Importantly, what initially attracts these new users to crypto may not be the same as what retains them. For example, Telegram’s native currency TON may serve as an on-ramp to crypto but, once users have TON, it will be easy to exchange it for other cryptoassets with a stronger value-prop and more established track record — and it’s likely that some non-negligible percentage of users will actually do so.”

New-Wave Stablecoins Offer a Key Feature: Trustworthiness

Bogart also points out that there’s a fundamental difference in the latest stablecoins as opposed to those that have long existed (like Tether) as digital proxies for fiat currencies.

“While models of fiat coins have existed for years, two aspects — trust and convenience — are changing. First, they’re increasingly issued from more trusted originators and, second, they’re moving closer to where capital resides today (at financial institutions) — making it quicker and easier to move from USD to digital, blockchain-based USD.”

The post mentions that Blockchain Capital estimates the current crypto userbase to be around 100 million, saying it took ten years to reach this point. The network effect teaches us that the pace of growth will hasten the larger the userbase is.

When Will Bitcoin Adoption Finally Reach Critical Mass?

Mass adoption remains the crypto industry’s White Whale. | Source: AFP PHOTO / PHILIPPE LOPEZ

Mass adoption is a great mystery for the cryptosphere. Many thought it might have happened by now, and some see it as the only definition of success for Bitcoin and the cryptocurrency industry at large.

The concept of “hyperbitcoinization” has been making the rounds again recently – an indeterminate reality where Bitcoin becomes the base currency for the whole of the world’s economic functions.

There’s no evidence that any amount of user adoption will necessarily lead to such a situation, but certainly, the more that crypto pervades into mainstream society, the greater both its value and demand will be.