A recent CNBC report is alleging that Facebook could generate numerous billions worth of dollars in revenue from a cryptocurrency. This comes amid stubborn rumors that Facebook may be currently developing its own cryptocurrency.
A proprietary Facebook cryptocurrency could represent a new revenue stream
More specifically, this latest report comes from a client note from Barclays internet analyst Ross Sandler. Moreover, Sandler suggests that Facebook could be interested in establishing a cryptocurrency due to the fresh revenue stream it would represent.
This could be particularly important for Facebook, seeing as its share price has suffered a number of setbacks since last year. Furthermore, the social media giant has also been plagued by several high-profile scandals during the past year.
As such, Sandler notes that a cryptocurrency-based revenue stream is, therefore, ”sorely needed at this stage of the company’s narrative” as it struggles to ease its woes.
In addition to this, Sandler also suggests that Facebook’s shareholders are likely to be positive to any new advertise-free revenue streams.
Although Sandler suggests that a ”conservative estimate” for how much revenue a potential Facebook Coin could bring is $3 billion by 2021, it could generate far more. In fact, Sandler argues that Facebook’s own currency could bring as much as $19 billion in additional revenue to the social media giant by 2021.
Facebook Coin is rumored to have ties to ”Facebook credits” from 2010
It is worth noting that a ”Facebook Coin” is not as far-fetched an idea as it might initially seem. Facebook was working together with the Californian company The Menlo Park on a project to launch ”Facebook credits” as far back as 2010.
Moreover, this project was supposedly intended to become a virtual currency for in-app-purchases, not entirely unlike a cryptocurrency.
Nevertheless, Sandler also proposed that Facebook may decide to absorb interchange costs between its potential new cryptocurrency and fiat currencies. Although this could likely boost its appeal, it is also possible that this could impact Facebook’s profitability.
Furthermore, Sandler also cited a Barclays’ analysis, noting that ”Facebook Coin” – or at least the first version of it – might take the form of a single purpose coin for domestic peer-to-peer (P2P) money transfer and micro-payments.
If this ends up being the case, Facebook Coin might be very similar to the original vision for Facebook credits from 2010. Toshi Times recently covered how work on Facebook Coin is said to be progressing within the company, albeit shrouded in immense secrecy.
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Rasmus Pihl is a writer for Toshi Times by day and an avid follower of the cryptocurrency industry by night. Rasmus holds a Bachelor’s Degree in Marketing from the Gothenburg School of Business, Economics, and Law and runs a Swedish marketing consulting firm. Moreover, when he isn’t writing for Toshi Times, traveling, working or changing the world in some other capacity, Rasmus is more than likely caught up in postgraduate studies.