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Facebook is considering a cumbersome venture capital proposal for its next stablecoin project.
According to New York Times journalist and longtime columnist Nathaniel Popper, the social media giant is looking at just as much money to leverage investment in its cryptocurrency project. Popper writes in a tweet published on April 4
"Update on Facebook Cryptocurrency: Sources tell me that Facebook is now looking to get venture capitalists to invest in Facebook's cryptocurrency project we introduced earlier this year. I heard that they were targeting large sums, up to $ 1 billion. "
Update on Facebook Cryptocurrency: Sources tell me that Facebook is now looking to get venture capitalists to invest in Facebook's cryptocurrency project we introduced earlier this year. I hear that they are targeting large sums, up to $ 1 billion.
– Nathaniel Popper (@nathanielpopper) April 8, 2019
Popper, who recounted the beginnings of cryptocurrency in his 2015 book Digital Gold, had an interesting idea of how Facebook could use fundraising for the stablecoin project to improve its appearance within the crypto industry. According to Popper, ensuring that the project is financed by outside investors would be a way for Facebook to preserve the consistency of their coins with the decentralized ethic of cryptocurrency, namely:
"Given that decentralization is one of the great attractions of blockchain projects, the use of outside investors could help Facebook introduce the project as being more decentralized and less controlled by Facebook."
One source also tells Popper that venture capital could simply be used as collateral for the project. Compared to most crypto-currencies, such as Bitcoin and Ethereum, which operate similarly to digital resources that can appreciate and the price may fluctuate, Facebook is looking to create a stable reserve for its messaging services. Although this technology offers an attractive, stable piece in terms of price and more user-friendly for the average user, it also requires a substantial amount of backup to secure the value of the currency. Tether, the company behind the USD of the United Kingdom, has repeatedly been the target of concerns about the exact reverse of the coin.
Even with Facebook hosting a market capitalization of $ 500 billion, $ 1 billion in venture capital supporting the stable fund would go a long way toward ensuring the goodwill of coin users and investors,
"One person I spoke to said that Facebook was talking about using money as collateral for its cryptocurrency. Facebook designed the coin to maintain a stable value, attached to a basket of currencies held in bank accounts. "
Popper has concluded his series of updates on Facebook and their stable fundraising by asking a question to many investors probably arise
"It's interesting to think of one of the richest companies in the world that raises money. When was the last time that they did fundraising on the outside?
As investors and cryptocurrency enthusiasts celebrate the latest upward movement of prices, with Bitcoin recording its best trading day last week since December 2017, the fixed currency market remains a major attraction in terms of adoption. Stable price coins, such as the currency developed by Facebook, offer users the convenience of decentralized digital currencies while separating them from the daily price volatility of traditional crypto.
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