Last May, Facebook announced a significant management shake-up, which saw many prominent figures in the company changing roles, including one of particular note.
In among the various executive announcements, Facebook Messenger chief David Marcus was moved to head a newly formed group examining the possibilities of Blockchain within Facebook. What could that mean? What could Facebook be investigating with Blockchain technology? The move was particularly noteworthy given Marcus' background - Marcus' former role was President of PayPal, before he joined The Social Network.
Marcus had been using his payments expertise to convert Messenger into the next big thing in digital shopping and business interaction, but with those efforts stalling somewhat, his focus was shifted to Blockchain.
What would that involve, in practical terms, for The Social Network?
It looks like we're getting closer to finding out - according to The New York Times, Facebook is working on a new cryptocurrency offering which would enable users of Facebook's apps to easily exchange money between friends, facilitating universal payments.
As per the NYT report:
"The company is working on a coin that users of WhatsApp, which Facebook owns, could send to friends and family instantly, said five people briefed on the effort who spoke on the condition of anonymity because of confidentiality agreements."
The report suggests that Facebook's payment system would offer similar functionality to WeChat in China, which enables WeChat users to pay for a wide range of things through the app. The initiative would also make it easier to exhange money between countries, which is particularly relevant in the developing world, where it's often harder for people to open bank accounts and buy things online.
Essentially, a dedicated Facebook cryptocurrency could lead to a more 'borderless' on-platform economy, where anyone, from anywhere, could easily and quickly purchase items online, facilitated through person-to-person exchange. That could also be extended to business payments, though the initial focus on simplified consumer exchange would make it easier for Facebook to develop its systems, and build its payments infrastructure, free from external regulation and exchange costs.
That would also come with some concerns - as noted by NYT:
"The lack of a central authority over cryptocurrencies - a government or bank - has made them useful to criminals and scammers, and the designs of the computer networks that manage them make it hard to handle significant numbers of transactions.
Facebook certainly has the scale to bring its coin offering to the masses, but such issues would persist, even with the support of Facebook's brand recognition.
And that brand recognition may not be overly helpful at this stage, given the various privacy and data controversies at Facebook of late. But no doubt The Social Network has considered this, and is examining the most effective, efficient ways to utilize the option to boost on-platform commerce and monetary exchange.
If successful, Facebook's crypto efforts could have a huge impact for businesses. By expanding opportunities, through simplified Facebook payments, even the smallest operator could reach massive global markets with their offerings. It remains to be seen exactly how this would work, but it might also be the thing that changes user perception around Messenger and WhatsApp, and converts them into key apps for connecting a wide range of day-to-day functions and processes.
Facebook hasn't revealed any specific details, but it'll be interesting to see what they come up with on this front, after almost a year of development. Expect to see movement soon.