With the continued domination in the tech world, Facebook continues to show its might despite stiff competition. Is Facebook entry to blockchain technology a strategy to stay relevant and ahead of the competition?
Facebook is planning to invest in blockchain technology soon. Though the company is still silent on it, there are rumors that Facebook blockchain will soon be a reality.
Recently, there were media reports that Facebook had launched a team of internal experts with the aim of exploring blockchain technology. The world’s social media giant is believed to be tirelessly working on introducing its own form of cryptocurrency, with the aim of offering its huge list of users with some form of a “digital token” that will enable them to carry out transactions through the platform.
But what exactly is blockchain technology? And is Facebook really getting into it?
In short, blockchain is another way of conducting transactions and other transfers online without the requirement of an intermediary in place. Instead of going ahead and putting all the trust in a third party to ensure that all transactions are accurate and safe, blockchain lets one seal transaction “pages” by use of a certain key code for security purposes.
Even though the company has neither denied nor confirmed its interest in getting into the blockchain business or industry, there some speculations that Facebook is fast considering launching its own cryptocurrency, though no timeline for such exists. Blockchain, a technology that goes ahead to underpin other cryptocurrencies such as bitcoin, may end up having other business applications such as a ledger aimed at recording transactions and facilitating other payments processing, especially for those of its members that exceed 2 billion. In fact, many are eagerly waiting for the day when Facebook blockchain will become a reality.
How Facebook can leverage blockchain technology to achieve its goals in the payment processing industry
Hire cryptocurrency experts and pioneers
Arguably, Facebook is one of the most advanced and among the most profitable companies in the globe. As of 2017, Facebook had slightly over $40.7 billion in revenue, with the figure expected to increase this year. In order to leverage blockchain technology and achieve its goals in the payment processing industry that is turning out to be profitable, Facebook can go ahead and hire cryptocurrency experts and pioneers with sufficient knowledge of how they can go about introducing their own cryptocurrency. Some well-known experts include Vitalik Buterin, Charlie Lee and Jeb McCaleb, just to mention a few.
Take advantage of its huge list of clients
It is a well-known fact that Facebook has one of the highest numbers of users who are registered under it. As of 2017, the social media giant headed by Mark Zuckerberg has more than 2 billion users globally, with such figures expected to increase with each year that passes. Facebook can take advantage of this fact and introduce its own currency to this huge marketplace section of selling and buying goods. In all the 2 billion clients that Facebook currently serves, a significant number of them may adopt the usage of cryptocurrency fast enough, and this is an opportunity that the company should not ignore.
Invest in further research on the advantages and disadvantages of blockchain technology
As noted above, Facebook is one of the richest companies across the globe. Additionally, the firm is rumored to be deeply concentrated on introducing its cryptocurrency. However, such a move would be unwise if some research is not conducted to determine whether such a move would bring in more revenues to the company or not. To fully leverage blockchain technology, Facebook should invest part of its profits on research initiatives aimed at discovering whether investing in blockchain or blockchain technology is a wise business decision or not.
Purchase other companies
Even though it may sound a bit harsh, at the end of the day, the main motive of companies is to stay relevant in the face of cutthroat competition. Facebook blockchain should use its power in the market to purchase other companies in the market or keep their audience from having the option of moving elsewhere.
Facebook continues to stay ahead of the competition. The acquisition of WhatsApp and Instagram is a clear sign that they will keep shining. This trend will be maintained when Facebook will welcome the blockchain technology.