One of the more interesting aspects of the discussion around Facebook's coming Libra cryptocurrency has been its suitability for digital commerce, with the biggest focus on that front coming from western nations.
But what if Libra, and Facebook's broader push into payments, wasn't about western regions at all? What if Libra was more about expanding The Social Network's hold in the world's second-largest single market?
This week, Facebook-owned WhatsApp confirmed that it now has 400 million active users in India, a nation with 450 million smartphone users overall, underlining the messaging app's dominance.
As reported by TechCrunch:
"WhatsApp, which has about 1.5 billion monthly active users worldwide, doesn't really have any major competitor in India. The closest to a competitor it has in the country is Messenger, another platform owned by Facebook, and Hike, which millions of users check everyday."
The figures show that WhatsApp is the clear leader in the Indian market - which, as noted, is interesting in relation to Libra, which, at least initially, was designed to appeal specifically to the Indian market.
As per Bloomberg last December:
"Facebook is working on making a cryptocurrency that will let users transfer money on its WhatsApp messaging app, focusing first on the remittances market in India"
Remittances - people sending money back to family from other regions - are huge in India, and it, initially, seemed as though Facebook would seek to provide a new, cost-free option to facilitate such through its crypto offering. Then, once those funds are being moved around within Facebook's system, it would look to provide additional options, like making bill payments, facilitating other transfer types, and eventually, incorporating online shopping.
That's the template WeChat has used in the world's most populous nation, China, where WeChat is used for a wide range of different commerce actions. WeChat is used by more than 900 million Chinese people daily, and facilitates over $10 trillion in payments each year.
If Facebook could achieve similar with Libra, that would be a huge potential opportunity for the company.
But that won't be easy, as Facebook has since said that it's not looking to launch Libra into the Indian market, at least not initially. At the Libra launch event last month, Facebook clarified that India was not part of its initial rollout plan, which may, in part, be due to concerns around cryptocurrency from Indian regulators. According to reports, India's central bank has said that it doesn't want cryptocurrency to spread like a “contagion” in the nation.
That could slow Facebook's expansion plans - though it is already planning to roll out WhatsApp Pay to all its Indian users toward the end of the year.
Maybe that could spark a re-think of Libra, and the way it's used. If it's not going to be accessible in Facebook's largest user market, maybe Libra is not as valuable as Facebook may have initially hoped. It could still be a worthwhile program, and Facebook may be able to re-negotiate to get Libra into India. But maybe, the restrictions in the Indian market will force Facebook to switch focus onto WhatsApp pay, and building up that eco-system instead.
It'll be interesting to see how Facebook looks to progress on this front, and what the future holds for Facebook's already challenged crypto offering.
Will Libra become an essential tool on the platform? Certainly, skepticism is rising.