March 4, 2019
Facebook, Telegram and Signal plan to utilize their messaging services as platforms to launch new cryptocurrencies over the next year. Their virtual currencies will allow users to send money to contacts around the world via the messaging services. According to inside sources, Facebook has been secretly working on a coin for WhatsApp that users could “instantly” send to friends or family. Facebook’s WhatsApp project is developed to the point that the company is already in discussions with cryptocurrency exchanges.
The New York Times reports that, “Telegram, which has an estimated 300 million users worldwide, is also working on a digital coin … [as is] Signal, an encrypted messaging service that is popular among technologists and privacy advocates … [and] the biggest messaging applications in South Korea and Japan, Kakao and LINE.” Unlike earlier cryptocurrencies, these messaging companies have a huge reach; “Facebook and Telegram can make the digital wallets used for cryptocurrencies available, in an instant, to hundreds of millions of users.”
Digital payments such as Venmo in the U.S. and WeChat Pay in China have become popular. “It’s pretty much the most fascinating thing happening in crypto right now,” said Primitive Ventures’ co-founder Eric Meltzer, whose company is a “cryptocurrency-focused venture capital firm.” “They each have their own advantage in this battle, and it will be insane to watch it go down.”
Facebook and the other companies involved in developing new digital currencies did not comment, but “most of them appear to be working on digital coins that could exist on a decentralized network of computers, independent to some degree of the companies that created them.” These cryptocurrenices would also “make it easier to move money between countries, particularly in the developing world where it is hard for ordinary people to open bank accounts and buy things online.”
Messaging companies will come up against “the same regulatory and technological hurdles that have kept Bitcoin from going mainstream.” Cryptocurrency’s lack of a central authority, an appealing feature to its advocates, has also made it “useful to criminals and scammers.” Another limitation is that, “the designs of the computer networks that manage them make it hard to handle significant numbers of transactions.”