Is Facebook thinking about accepting Bitcoin?

April 14, 2014 16:37 UTC
Marc Andreessen is a Facebook board member. He is also a firm believer in Bitcoin. He might be one of the reasons why Facebook will add Bitcoin payments in the future.

The price of Bitcoin is soaring today. We already have some theories about this being discussed here. Among some positive messages, something else was made public today. Something involving Facebook and e-money services, according to the Financial Times. Don’t start packing for the moon just yet, there is no guarantee Facebook is thinking about accepting Bitcoin. There are some reasons why it might be, though.

Facebook and the Bank of Ireland

Facebook has become one of the biggest enterprises in the world since Zuckerberg invented it in his Harvard dorm room. What started out as a ‘simple’ social media website, has now expanded into a vast place where many things are possible. Facebook has acquired several promising startups, making sure it is always a step ahead. Zuckerberg has a clear view on what Facebook is now and what it should become in the future. The near future clearly consists of optimal mobile integration. The buying of Whatsapp and Instagram indicate this, as well as his own words. He said the mobile industry is the most important aspect of Facebook’s plans. Recently, the social network also bought Oculus VR, a promising virtual reality enterprise.

Right now, it seems like Facebook is getting ready for another new technology. The company is readying itself to provide financial services in the form of remittances and electronic money. It seems the website is only weeks away from obtaining regulatory approval in Ireland for a service that would allow its users to store money on Facebook and use it to pay and exchange money with others, according to several people involved in the process.

So, Ireland… Several people already asked the question why it would be important to ask authorisation in Ireland. It seems the Central Bank of Ireland can authorize Facebook to become an “e-money” institution. This would allow them to issue units of stored monetary value that represent a claim against the company. This e-money would be valid throughout Europe via a process known as “passporting“.

To further state their interest in electronic money services, Facebook has also discussed partnerships with at least three London startups that offer international money transfer services. These startups are TransferWise, Moni Technologies and Azimo.

Who trusts Facebook?

All of this sounds very exciting, but it does not come without question marks. The first question Facebook should consider is: how many people are willing to put currency on Facebook? Whether true or not, Facebook is regarded by many people as a puppet of the NSA. There’s already so much of our data publicly available, adding financial information would be like putting out the final secrets of your life for every authority to know. Recent developments have shown that secrets do not exist anymore, especially on the internet. Facebook will have some serious convincing to do if it wants people to believe their money is safe with them.

A second question, perhaps the most important one for the cryptocurrency world. Facebook talks about e-money, not about Bitcoin. Some people think Facebook has a different strategy in mind. Maybe more like Mpesa, the mobile-phone based money transfer and microfinancing service for Safaricom and Vodacom, the largest mobile network operators in Kenya and Tanzania. Or Facebook might launch its own cryptocurrency? That’s doubtful, since Bitcoin is the major one. Something like Facebook coin does not sound very promising but who knows…

On top of that, the companies Facebook has allegedly closed partnerships with, have little to do with virtual money. They simply offer transfer services for fiat currencies. That does not mean anything because Facebook would allow all kinds of money. The company would never go for the addition of Bitcoin and nothing more. Still, there was no cryptocurrency enterprise present in this list.

Adding Bitcoin

On the other hand, Zuckerberg has always been interested in what the Winklevoss twins were up to. It is not secret that these entrepreneurs have heavily invested in Bitcoin. That will have sparked Zuckerberg’s interest. He will have thought about the concept already, and he may be waiting for the right moment to implement it.

Perhaps the most important reason Facebook would consider Bitcoin integration is the presence of one Marc Andreessen. This entrepreneur is a Facebook board member and an investor in Coinbase through his firm Andreessen Horowitz. Andreessen is known to have some serious influence in Silicon Valley. He is a respected authority in the field of technology, and he may just be the person Zuckerberg is willing to listen to.

In any case, this move by Facebook leaves room for much speculation. Nothing is certain yet, but there seem to be some strong indications toward Bitcoin adoption. It may not happen straight away, but if it does (and I believe, at some point, it might), this will be a giant leap for Bitcoin. Keep an eye on this one, Marc might surprise us this year…

Do you think Facebook will integrate Bitcoin at some point? Let us know your thoughts here.

Marc Andreessen photo by Wikipedia.

Last modified: April 14, 2014 16:39 UTC

@cryptomaniacs

Internet addict and virtual currency aficionado living in Belgium. I work in a school, where I am responsible for every computer and the entire network that keeps our students connected to the world. I love cryptocurrencies, mostly because it gives us a chance to take back our freedom. If we do this right, there are exciting times ahead!