Thanks to bitcoin and other cryptocurrencies, Facebook hopes to catch up in mobile payments. Aware of the global “cryptomania” and the increasing weight of bitcoin in private exchanges, Mark Zuckerberg, the company’s CEO, announced Thursday his intention to work on cryptocurrency in 2018.
Facebook’s CEO Mark Zuckerberg has even suggested the possibility of integration of cryptocurrencies in the mobile payment application of the social network without giving a timetable. “There are important counter-trends to this — like encryption and cryptocurrency — that take power from centralized systems and put it back into people’s hands,” said the 33-year-old billionaire in a message on his Facebook page. “I’m interested to go deeper and study the positive and negative aspects of these technologies, and how best to use them in our services.”
Zuckerberg’s interest in cryptocurrencies is not trivial. It comes at a time when Facebook is trying to ramp up its efforts in mobile payment, with its dedicated services on Messenger and Marketplace. Since 2015, the American giant has been offering a system to make payments between friends via Messenger in the United States.
This service was extended at the end of 2017 to European countries. Facebook users can also use Marketplace, a platform dedicated to sales from individual to individual. Marketplace has been available in the United States since 2016, and in Europe since 2017. The global giant is also thinking about offering its 2 billion users bill payment and investment services.
But these solutions are already all offered by the social giant’s main Asian competitors, which partly explains their leadership in the sector. In China, giants like AliPay and WeChat Pay already allow payments for everything online.
Thanks to their applications, Alibaba and WeChat hold about 92% of the mobile wallet market in China. The Chinese e-wallet market has about 500 million users, as many as the rest of the world’s users, according to a CGAP consortium study. But Asian giants, especially Chinese, are not present on the niche cryptocurrency market. The Chinese government has prohibited them to offer this kind of services.
This void left by the Chinese offers a potential boon for Facebook. By positioning itself on Bitcoin and its competitors, the social network could attack the Asian giants on their land with new mobile payment services. Furthermore, Facebook could also attract to its platform dozens, if not hundreds of millions of users, who would like to have access to mobile payment systems like bitcoin or one of the multitude of other “altcoins”.