Facebook Launches Payment Tool as its Crypto Plans with Libra Fail to see the light

Libra
Image Source: Shutterstock

Facebook Launches Payment Tool as its Crypto Plans with Libra Fail to see the light

Facebook announces the launch of  ‘Facebook Pay’ in a bid to finally enter the payments space.

Facebook’s crypto project, Libra, seems to have fallen on its knees due to the regulatory resistance. Hence, as its vision of global payments and cryptocurrency are put on hold, the social media giant has initiated USD payments in the US.

Facebook Pay works just like Venmo but will be available across all Facebook apps, including Instagram and WhatsApp. It will roll out its first version this week, beginning with Facebook and Messenger.

It will provide for fundraisers, in-game purchases, event tickets, person-to-person payments, as well as purchases from select Pages and businesses on Facebook Marketplace.

Facebook has been coveting the payments’ space for long. This move enables it to begin monetizing the social media space internally. Moreover, it will also aid in the unification of all Facebook services like WhatsApp, Instagram, and Messenger linked through a payment channel.

The blog post notes,

“Facebook Pay will make these transactions easier while continuing to ensure your payment information is secure and protected.”

What Happens to Libra?

Facebook’s much-hyped project seems to be failing as Governments across the world stand against it. First, they were against the idea of a ‘basket of currency’ as the proportion of assets in the basket would be arbitrary. Then Facebook proposed to move with an individual currency backed stablecoins.

However, it gave rise to the second issue of capital control. Consequently, in the US, the Financial and Housing Committee expressed that the stablecoins come under the purview of the SEC. The international trade organization, IOSCO, seems to agree with it as well that stablecoins must be regulated as securities.

Apart from competing with Paypal’s Venmo, Facebook Pay is the US equivalent of Alipay and WeChat payment system in China.

However, the Chinese seem to be ahead on that as they will soon launch its’ Digital Currency on the blockchain. Hence, under competitive pressures, Facebook must move into payments.

Meltem Demirors, the CSO at Coinshares observed from their recent research that,

Social networks are the new payment networks, and they’re going to be monster distribution channels…

Facebook Pay is independent of Libra and could provide efficient monetization for its users. Hence, eliminating the need for a blockchain-based system. However, it will be restricted by geographic boundaries. Thus, there is still seems to be some value for the company in pursuing its crypto project. However, in the current US regulatory environment, it looks like a far fetched dream.

Do you think the alternative taken by Facebook will affect the crypto markets? Please share your views with us. 

Summary
Facebook Launches Payment Tool as its Crypto Plans with Libra Fail to see the light
Article Name
Facebook Launches Payment Tool as its Crypto Plans with Libra Fail to see the light
Description
Facebook announces the launch of  'Facebook Pay' in a bid to finally enter the payments space. Facebook's crypto project, Libra, seems to have fallen on its knees due to the regulatory resistance from around the world.
Author
Publisher Name
CoinGape
Publisher Logo
Coingape is committed to following the highest standards of journalism, and therefore, it abides by a strict editorial policy. While CoinGape takes all the measures to ensure that the facts presented in its news articles are accurate.
Disclaimer The views, opinions, positions or strategies expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect the views, opinions, positions or strategies of CoinGape. Do your market research before investing in cryptocurrencies. The author or publication does not hold any responsibility for your personal financial loss.
Author: Nivesh Rustgi

Nivesh from Engineering Background is a full-time Crypto Analyst at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)coingape.com

Post your comment...
Nivesh Rustgi 808 Articles

Nivesh from Engineering Background is a full-time Crypto Analyst at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)coingape.com

Follow Nivesh @