Facebook Coin Seeks $1 Billion in Funding; Is it Really the ‘Biggest Boon for Crypto Ever?’

Journalist:
Ben Brown
April 9, 2019

Crypto entrepreneur and hedge fund manager Jeremy Gardner says Facebook’s impending cryptocurrency is not a threat to the bitcoin community.

In fact, he believes it’s a huge positive for crypto. Speaking at the ELEV8 conference, Gardner said:

“This may be the biggest boom for crypto ever… I can only see it being a net positive in the short term. The best way to go long on this is probably to own a little bit more bitcoin.”

It comes as New York Times journalist Nathanial Popper revealed that Facebook is seeking $1 billion in venture capital to fund its cryptocurrency project.

Facebook Seeking $1 Billion Venture Capital for Cryptocurrency

New York Times journalist Nathanial Popper revealed on Monday that Facebook is reportedly seeking $1 billion in VC funds to back its Facebook Coin.

According to Popper, the money aims to “back” Facebook’s cryptocurrency, in much the same way as other stable coins are backed by real dollars in a bank account.

Facebook’s Cryptocurrency: “Actually a Really Big Deal”

Plenty of criticism has been levelled at Facebook and others for crashing the crypto party, including from us here at CCN. But there’s a growing belief that Facebook’s cryptocurrency doesn’t actually threaten bitcoin.

As Kik founder Ted Livingston explains, Facebook Isn’t Going After Bitcoin. It’s Going After the Dollar. In his Medium post, Livingstone elaborates:

“We think Facebook could be on a path to replace the US dollar as the global reserve currency.”

Facebook’s cryptocurrency will be a “digital dollar,” a stable coin allowing users to send money via messaging services with ease. It’s similar to how WeChat pay already works in China. Crucially, Facebook Coin could facilitate cheap and fast remittance payments around the world.

“This is actually a really big deal, one which could be meaningfully important on a very personal and day-to-day level for many millions of people worldwide” – Jon Evans, Tech Crunch.

FaceCoin: Good For Bitcoin?

Expanding on his “boon for crypto” comments, Gardner explained how Facebook Coin is a good thing for bitcoin.

“Imagine if every Facebook user in the United States or in the world all of a sudden has this cryptocurrency… Let’s say everyone gets a few bucks and, you know, they don’t have an off-ramp in their jurisdiction through Facebook or they don’t have a bank account. They can now go and sell that at a cryptocurrency exchange.”

Gardner suggests that Facebook users might use “zuckbucks” as an on-ramp into bitcoin or other cryptocurrencies. The move could inject billions of dollars in the existing crypto market. We already know that Facebook is talking to numerous cryptocurrency exchanges about listing its coin, potentially within the next few months.

Gardner’s got a point. Imagine 2 billion Facebook users, many without traditional bank accounts, getting instant access to cryptocurrency. As Gardner says, “I can only see it being a net positive in the short term.”

Last modified (UTC): April 9, 2019 10:27

Ben Brown

Ben is a journalist with a decade of experience covering financial markets. Based in London, UK, his writing has appeared in The Huffington Post and he was Chief Editor at Block Explorer, the world's longest-running source of Blockchain data. Reach him at benjamin-brown.uk or on Twitter at _Ben_Brown. Email ben @ benjamin-brown.uk.