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I will revisit this thread in 2021 just to see how wrong everyone was. FB has billions of users that interact with its product everyday. People who make plans,

I will revisit this thread in 2021 just to see how wrong everyone was. FB has billions of users that interact with its product everyday. People who make plans, attend events, split all sort of bills. A borderless stablecoin will be a gamechanger. It can fuel commerce but above that it will kill many middlemen and rightly so.

fullshark 7y ago
A payments system on Facebook makes a ton of sense and would be very useful. I just don't get why it has to be cryptocurrency.
- negamax 7y ago
  Biggest benefit of using blockchain and cryptocurrency here is open trust (this term is the best way I can think about describing this). Any internal database is subject to all kind of human and technical errors. But with a network of trusted parties that solves the Byzantine Generals Problem. This becomes secure and trusted as trust is given. No one can hack it at will without taking the 50% of the network down and compromising multiple entities. This is a bizarre technical, social and economic feat. I wish Apple was the one pulling this instead of FB. But quite certainly there are more FB users than iPhone users.
  - Geee 7y ago
    Not true for stablecoins, which aren't really cryptocurrencies. The most important single-point-of-failure in currencies is the supply mechanism, which must be trusted. The supply of centralized stablecoins can't be trusted. It is open to human greed, errors and hacking. Do you trust Mr. Zuckerberg having control of the future money supply? Centralized stablecoins should be illegal, because the issuer can print money from thin air without collateral, unlike banks which are regulated and the money supply is controlled with interest rates.
- tim333 7y ago
  A feature of cryptocurrencies like ethereum or bitcoin is they can be anonymous and unregulated which can make small transactions cheap. You can get an ethereum address and I can send you 10c worth of it for maybe 2c in costs and that's it. To do similar in fiat we each need financial institutions which may have to spend a fair bit each to do KYC on us. It remains to be seen where Facebook will fit on the regulated/unregulated spectrum. Somewhere between the two I imagine.
- dead_mall 7y ago
  What else would it be? Some in house software, mysql based currency system? What is it about cryptocurrency that people still don't get?
- zeroxfe 7y ago
  Two things I can think of: - you can get transparency (the entire ledger must be public, so you reduce the risk of many kids of internal fraud and manipulation.) - you can use these coins outside the facebook ecosystem -- I can't think of immediate value here, but I can see a long play where Facebook can turn into a bank
  - e12e 7y ago
    Surely the long play is turning Facebook into sovereign nation state? Only half-joking...
  - rafiki6 7y ago
    This is the first and only comment I've read that actually gives credence to the idea of FB making it as a cryptocurrency, but it still falls short of a simple idea and gives FB too much credit for being an "open" player. FB is the issuer, why can't they just provide APIs to their ledger and APIs for settlement so it can be used outside of their direct ecosystem, but still allows them full control? FB wants to keep people in their ecosystem.
  - Barrin92 7y ago
    wait a second, when did facebook say that the ledger will be visible to the public?
- miguelmota 7y ago
  Cryptocurrencies are trustless in principle. You don’t have to trust that FB updated your balance in their database correctly or tampered with historical data when you can simply pull all the transaction history from the blockchain and verify for yourself and with peers from the network.
- flycaliguy 7y ago
  Don’t forget that Facebook is extremely capable of reading the public. It could be a marketing tool designed to capture early adaptors.
  - village-idiot 7y ago
    They’re also capable of the self delusion that is depressingly common for large companies.
    - flycaliguy 7y ago
      I agree and it really does blow my mind how powerful their service could be if fully utilized as an internal intelligence gathering tool.
- hn_throwaway_99 7y ago
  Facebook already had Facebook Credits around 2011-2012, but it was killed in 2013.
stvswn 7y ago
I agree to the extent that many seem to acknowledge the transfer and remittance use case but seem to think that the market is already filled by niche players -- the fact that FB doesn't have to contend with network effects because everyone already has Messenger and/or WhatsApp is a huge deal. It is simultaneously the case that FB can't build this and then magically be exempt from each jurisdiction's laws related to cross-border transfers. It's not like a real decentralized coin where there's no real enforcement mechanism, each government will know exactly where to knock and FB will play ball with reporting requirements, etc. I think the right analogy is that they want to be to the rest of the world what AliPay is to China -- ubiquitious, so that it will very quickly be the case that you know everyone supports it in the world so you don't need to carry around your credit cards. Sort of like what Apple and Google Pay would want to be but with a larger incentive for retailers to adopt it as it has instantly higher penetration among users. It also might be more likely that messaging payments to a retailer becomes the norm instead of NFC (like how everyone in China pays for a restaurant check with AliPay by simply sending payment via message to the address, usually on the table in a QR code). I'm not sure that it needs to be a blockchain but I assume it's about making the economics work by cutting out middlemen. If FB gets everyone to use this in their daily lives, however, it'll be a huge win for FB even if they don't make money on it directly -- because purchase data is very valuable, but also because you can't feasibly get rid of FB once it becomes your normal payment method.
akdfd 7y ago
Yeah, I can't wait until FB starts selling my entire transaction history to anyone that wants it to pay for this magical free service. Also, PayPal already tried to do this 20 years ago. It won't happen.
skizm 7y ago
Wouldn’t Facebook just become the middleman instead of visa or whoever?
013a 7y ago
Every new financal technology tries to kill the existing middlemen, then replace them with new middlemen who promise to be better. Turns out, these new middlemen (1) never fully comprehend how complex modern finance is, which raises costs, and (2) are human and thus become corrupt, whether subtly or unsubtly, over time. I also have a sneaking suspicion that, in conjunction with point (1), many of these modern finance plays also totally fail to comprehend the vast investment into technology that traditional finance companies have made. They see a shitty iOS app, think "wow Old School Bank is never going to understand computers, let's disrupt them", so they start with an amazing iOS app, then struggle to reliably implement the rest of the stuff that matters (process automation, scalability, government relationships, customer support). Point being, the world turns, time goes on, the players might change, but the game doesn't.
- negamax 7y ago
  I don't understand your point. No one is disagreeing about the contribution that big finance has made in shaping our current systems. FB raised money, got listed. There's tons of financial system which helped them and help everyone from invoices to making a trip everyday. But that doesn't mean something better can't come up. People don't hate banks for the monolith but their monopoly like nature that had stifled innovation and displayed outright criminal behavior. Don't forget 2008 recession was triggered by banks. Recent libor scandal.. About the technology investments. I would argue against this. Banks are more regulatory and defend my turf play than a technology play. Have you ever worked for a bank or any finance facing institution. There's layers and layers of clutter. Whole party is one big monolith, sucking money from places that it doesn't deserve. Biggest benefit banks provide as in traditional banks is the account and trust that, that money in the account will remain on the name of holder. That trust as well was breached multiple times during withdrawal limits and freezes. We all need better alternative. May be FB won't be the one. May be bank themselves will become more open and lean. But someone needs to push. There's a lots of money to be made and quite frankly FB deserves it for trying.
  - 013a 7y ago
    > Banks are more regulatory and defend my turf play than a technology play. There's layers and layers of clutter. Why do you think this is? Do you think its just because "hur hur they're evil"? I'm not saying there isn't some of that. But I am saying: 1. The big banks have discovered something that the small, modern banks haven't. YET. They will. Its that banking sucks, and we need the regulatory hurdles. 2. If you think these small banks don't have the potential to be just as evil as the big ones currently are, you're delusional. Money corrupts everything. Google and Facebook used to be the darling of the tech community, and look at them now. If they can turn so suddenly, anyone can. Maybe we need a better system. Maybe we dislike the system we have, but we can't have a better one. Maybe we need better people. But, you can't change human nature. Healthcare is a similar industry. Its ridiculously huge. Everyone needs it. There's trillions of dollars in it. Plenty of money. Then Theranos comes along and thinks that the old way of doing things is overrated. And then they die. Because, fun fact, agility and leanness works in some industries, but its mostly industries that don't actually matter.
itslennysfault 7y ago
Why do they need a crypto currency to achieve that? How is it superior to just a number in a database to represents your balance on facebook? Facebook is centralized what advantage does a decentralized currency have for them? Venmo/Paypal seem to have no problem achieving this without a blockchain.
- brink 7y ago
  If you want global adoption, make it open. That's what Android does. That's what Linux does. That's what cryptocurrency achieves. That's what Facebook wants.
ilaksh 7y ago
I am all for borderless stablecoins and agree with everything you say except that you imply that we should let Facebook and and control it, which makes no sense.
anonymous5133 7y ago
Bingo. I completely agree. Yes, it is kind of a hassle to have FB using this globalcoin rather than just use a standard decentralized crypto but it is a start at least.
wbronitsky 7y ago
You might have a good point, but why present it in this way? It is needlessly condescending and makes people want to not believe you. You could have easily stated your case for how much utility and adoption you think this will have without looking down your nose at people who hold a different opinion. Comments like this devalue the entire conversation being had here by pushing people either towards twitter style shitposting/flamewars, which are terrible ways to have conversations, or simply causing those who would like to comment to not engage. Either way, can you not?
- wbronitsky 7y ago
  Wow, downvoted for pointing out the shitty tenor of conversation on this site. I don't know why I participate any more
rafiki6 7y ago
I don't understand why you're assuming "everyone" here will be wrong. I have yet to see a comment that has detracted from the value this brings to Facebook. What doesn't make any level of sense is why it's being labeled a cryptocurrency. It's a currency controlled by Facebook. That's no different than regular money issued by a central bank.

fullshark 7y ago

A payments system on Facebook makes a ton of sense and would be very useful. I just don't get why it has to be cryptocurrency.

negamax 7y ago
Biggest benefit of using blockchain and cryptocurrency here is open trust (this term is the best way I can think about describing this). Any internal database is subject to all kind of human and technical errors. But with a network of trusted parties that solves the Byzantine Generals Problem. This becomes secure and trusted as trust is given. No one can hack it at will without taking the 50% of the network down and compromising multiple entities. This is a bizarre technical, social and economic feat. I wish Apple was the one pulling this instead of FB. But quite certainly there are more FB users than iPhone users.
- Geee 7y ago
  Not true for stablecoins, which aren't really cryptocurrencies. The most important single-point-of-failure in currencies is the supply mechanism, which must be trusted. The supply of centralized stablecoins can't be trusted. It is open to human greed, errors and hacking. Do you trust Mr. Zuckerberg having control of the future money supply? Centralized stablecoins should be illegal, because the issuer can print money from thin air without collateral, unlike banks which are regulated and the money supply is controlled with interest rates.
tim333 7y ago
A feature of cryptocurrencies like ethereum or bitcoin is they can be anonymous and unregulated which can make small transactions cheap. You can get an ethereum address and I can send you 10c worth of it for maybe 2c in costs and that's it. To do similar in fiat we each need financial institutions which may have to spend a fair bit each to do KYC on us. It remains to be seen where Facebook will fit on the regulated/unregulated spectrum. Somewhere between the two I imagine.
dead_mall 7y ago
What else would it be? Some in house software, mysql based currency system? What is it about cryptocurrency that people still don't get?
zeroxfe 7y ago
Two things I can think of: - you can get transparency (the entire ledger must be public, so you reduce the risk of many kids of internal fraud and manipulation.) - you can use these coins outside the facebook ecosystem -- I can't think of immediate value here, but I can see a long play where Facebook can turn into a bank
- e12e 7y ago
  Surely the long play is turning Facebook into sovereign nation state? Only half-joking...
- rafiki6 7y ago
  This is the first and only comment I've read that actually gives credence to the idea of FB making it as a cryptocurrency, but it still falls short of a simple idea and gives FB too much credit for being an "open" player. FB is the issuer, why can't they just provide APIs to their ledger and APIs for settlement so it can be used outside of their direct ecosystem, but still allows them full control? FB wants to keep people in their ecosystem.
- Barrin92 7y ago
  wait a second, when did facebook say that the ledger will be visible to the public?
miguelmota 7y ago
Cryptocurrencies are trustless in principle. You don’t have to trust that FB updated your balance in their database correctly or tampered with historical data when you can simply pull all the transaction history from the blockchain and verify for yourself and with peers from the network.
flycaliguy 7y ago
Don’t forget that Facebook is extremely capable of reading the public. It could be a marketing tool designed to capture early adaptors.
- village-idiot 7y ago
  They’re also capable of the self delusion that is depressingly common for large companies.
  - flycaliguy 7y ago
    I agree and it really does blow my mind how powerful their service could be if fully utilized as an internal intelligence gathering tool.
hn_throwaway_99 7y ago
Facebook already had Facebook Credits around 2011-2012, but it was killed in 2013.

stvswn 7y ago

I agree to the extent that many seem to acknowledge the transfer and remittance use case but seem to think that the market is already filled by niche players -- the fact that FB doesn't have to contend with network effects because everyone already has Messenger and/or WhatsApp is a huge deal. It is simultaneously the case that FB can't build this and then magically be exempt from each jurisdiction's laws related to cross-border transfers. It's not like a real decentralized coin where there's no real enforcement mechanism, each government will know exactly where to knock and FB will play ball with reporting requirements, etc. I think the right analogy is that they want to be to the rest of the world what AliPay is to China -- ubiquitious, so that it will very quickly be the case that you know everyone supports it in the world so you don't need to carry around your credit cards. Sort of like what Apple and Google Pay would want to be but with a larger incentive for retailers to adopt it as it has instantly higher penetration among users. It also might be more likely that messaging payments to a retailer becomes the norm instead of NFC (like how everyone in China pays for a restaurant check with AliPay by simply sending payment via message to the address, usually on the table in a QR code). I'm not sure that it needs to be a blockchain but I assume it's about making the economics work by cutting out middlemen. If FB gets everyone to use this in their daily lives, however, it'll be a huge win for FB even if they don't make money on it directly -- because purchase data is very valuable, but also because you can't feasibly get rid of FB once it becomes your normal payment method.

akdfd 7y ago

Yeah, I can't wait until FB starts selling my entire transaction history to anyone that wants it to pay for this magical free service. Also, PayPal already tried to do this 20 years ago. It won't happen.

skizm 7y ago

Wouldn’t Facebook just become the middleman instead of visa or whoever?

013a 7y ago

Every new financal technology tries to kill the existing middlemen, then replace them with new middlemen who promise to be better. Turns out, these new middlemen (1) never fully comprehend how complex modern finance is, which raises costs, and (2) are human and thus become corrupt, whether subtly or unsubtly, over time. I also have a sneaking suspicion that, in conjunction with point (1), many of these modern finance plays also totally fail to comprehend the vast investment into technology that traditional finance companies have made. They see a shitty iOS app, think "wow Old School Bank is never going to understand computers, let's disrupt them", so they start with an amazing iOS app, then struggle to reliably implement the rest of the stuff that matters (process automation, scalability, government relationships, customer support). Point being, the world turns, time goes on, the players might change, but the game doesn't.

negamax 7y ago
I don't understand your point. No one is disagreeing about the contribution that big finance has made in shaping our current systems. FB raised money, got listed. There's tons of financial system which helped them and help everyone from invoices to making a trip everyday. But that doesn't mean something better can't come up. People don't hate banks for the monolith but their monopoly like nature that had stifled innovation and displayed outright criminal behavior. Don't forget 2008 recession was triggered by banks. Recent libor scandal.. About the technology investments. I would argue against this. Banks are more regulatory and defend my turf play than a technology play. Have you ever worked for a bank or any finance facing institution. There's layers and layers of clutter. Whole party is one big monolith, sucking money from places that it doesn't deserve. Biggest benefit banks provide as in traditional banks is the account and trust that, that money in the account will remain on the name of holder. That trust as well was breached multiple times during withdrawal limits and freezes. We all need better alternative. May be FB won't be the one. May be bank themselves will become more open and lean. But someone needs to push. There's a lots of money to be made and quite frankly FB deserves it for trying.
- 013a 7y ago
  > Banks are more regulatory and defend my turf play than a technology play. There's layers and layers of clutter. Why do you think this is? Do you think its just because "hur hur they're evil"? I'm not saying there isn't some of that. But I am saying: 1. The big banks have discovered something that the small, modern banks haven't. YET. They will. Its that banking sucks, and we need the regulatory hurdles. 2. If you think these small banks don't have the potential to be just as evil as the big ones currently are, you're delusional. Money corrupts everything. Google and Facebook used to be the darling of the tech community, and look at them now. If they can turn so suddenly, anyone can. Maybe we need a better system. Maybe we dislike the system we have, but we can't have a better one. Maybe we need better people. But, you can't change human nature. Healthcare is a similar industry. Its ridiculously huge. Everyone needs it. There's trillions of dollars in it. Plenty of money. Then Theranos comes along and thinks that the old way of doing things is overrated. And then they die. Because, fun fact, agility and leanness works in some industries, but its mostly industries that don't actually matter.

itslennysfault 7y ago

Why do they need a crypto currency to achieve that? How is it superior to just a number in a database to represents your balance on facebook? Facebook is centralized what advantage does a decentralized currency have for them? Venmo/Paypal seem to have no problem achieving this without a blockchain.

brink 7y ago
If you want global adoption, make it open. That's what Android does. That's what Linux does. That's what cryptocurrency achieves. That's what Facebook wants.

ilaksh 7y ago

I am all for borderless stablecoins and agree with everything you say except that you imply that we should let Facebook and and control it, which makes no sense.

anonymous5133 7y ago

Bingo. I completely agree. Yes, it is kind of a hassle to have FB using this globalcoin rather than just use a standard decentralized crypto but it is a start at least.

wbronitsky 7y ago

You might have a good point, but why present it in this way? It is needlessly condescending and makes people want to not believe you. You could have easily stated your case for how much utility and adoption you think this will have without looking down your nose at people who hold a different opinion. Comments like this devalue the entire conversation being had here by pushing people either towards twitter style shitposting/flamewars, which are terrible ways to have conversations, or simply causing those who would like to comment to not engage. Either way, can you not?

wbronitsky 7y ago
Wow, downvoted for pointing out the shitty tenor of conversation on this site. I don't know why I participate any more

rafiki6 7y ago

I don't understand why you're assuming "everyone" here will be wrong. I have yet to see a comment that has detracted from the value this brings to Facebook. What doesn't make any level of sense is why it's being labeled a cryptocurrency. It's a currency controlled by Facebook. That's no different than regular money issued by a central bank.