What Are The Implications Of Facebook Using Blockchain Technology?

By Bank of Hodlers on ALTCOIN MAGAZINE

Bank of Hodlers
May 27 · 5 min read

With personal privacy being one of the hottest topics of discussion in the latter half of the last decade, it’s easy to forget just how relatively new this concept really is. The fact that many privacy-related laws in most countries were written before social media websites were even a staple in our everyday lives, is a massive contributing factor to tech companies getting away with extremely unethical practices.

The Cambridge Analytica Scandal And Its Fallout

Then 2018 happened, which was a big year for a variety of reasons and one that forever changed how we view online privacy. The Cambridge Analytica scandal proved to be the biggest scandal in the history of the largest social media company in the world, Facebook.

For the uninitiated, Cambridge Analytica was a political data consulting firm based out of the UK that did something truly horrifying. They harvested the personal data of millions of Facebook users without any form of consent whatsoever, in order to use it for political campaigns. To cut this really sinister, convoluted and long story short, the leaders of the world finally turned their attention towards the pathetic state of data privacy laws that allowed something like this to happen in the first place.

It shook the very foundation of what ‘online data privacy’ meant to the world and the company is still dealing with the fallout and the loss of trust that came with it.

A senator actually told Mark Zuckerberg to his face that, “Your user agreement sucks!”

All of a sudden, online privacy became the top priority for all major social media companies in the world and all of them began the hunt for possible solutions.

Blockchain And Cryptocurrency As A Solution

As long as the main revenue model for Facebook relies on using people’s data for advertising, it can never guarantee that the data of its users will not fall into the wrong hands. Which is why Facebook is planning to use the power of blockchain technology to win back the faith of its users with its data protection promises.

Facebook has been circling around blockchain technology for the past couple of months, and now they are finally ready to go ahead with it, with them announcing the launch of their very own stablecoin — an announcement that was met with mixed reactions from the cryptocurrency and blockchain community.

Some people have taken it as a hint that Facebook is seeking out blockchain for business models outside of running ads and to start generating revenue through a transaction-based model using its stablecoin. It’s going to be rolled out in India first and it would be exciting to see if their plans work or if they end up failing miserably.

Hello “GlobalCoin”

Facebook has announced that “GlobalCoin” will be launched in early 2020, and will be available in close to a dozen countries before the first quarter of next year comes to a close.

Facebook isn’t playing around with their cryptocurrency plans either, they plan on using it to become a powerhouse that manages a large number of payments on a global scale, in a way that no other bank or company has ever done before.

A “Pay with FB” option might soon be on the horizon, according to experts, which will be a solid win for Facebook if it does turn into reality as the number of digital payments is rising exponentially every single year. This will give Facebook a great incentive to move away from advertising and thus it would feel much less inclined to sell off users data to make money.

But There’s More

“GlobalCoin” is not the only way Facebook is looking to use blockchain technology in order to further secure data or its users. According to reports, Facebook is planning something truly revolutionary. Facebook is trying to figure out a way to integrate blockchain technology into its user login and post sharing system.

If it turns out to become a reality, it will the biggest change to Facebook’s core in over a decade and it will definitely bring the interest of other big tech corporations to an all-time high.

While Facebook reported that it already has a 40 people team working on this project, there is no official word of confirmation that this is what they are working on. If successful, a blockchain based login and data sharing platform will definitely be a big step in winning back the good-will it drastically lost because of the Cambridge Analytica scandal.

This article was written by Haroon Beg. (The views and opinions expressed in the article are solely the author’s and does not necessarily represent any of the actual entities mentioned above)


About Bank Of Hodlers

Bank of Hodlers is building a customer-centric bank on the blockchain, by providing financial services like cryptocurrency-backed loans and cryptocurrency-backed cards.

We have recently launched our asset-backed lending product where you can earn interest on your BTC, ETH, TUSD, and DAI. You also have the option to borrow DAI against Ethereum. You can sign up to the platform by clicking here: app.bankofhodlers.com/register.


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