Few hours ago, I wrote that Facebook is out to build the global single currency which will work agnostic of location or market. With this business model, Facebook will not have to monetize WhatsApp via advertising. This is a game changer; it implements that agnostic special single currency for Africa at global level. By developing a proprietary stablecoin with local flavors, Facebook will mirror local economies and currencies, and in the process makes it easier for merchants to price products based on the coins since they are directly linked to the values of the local currencies. For example, one Facebook Stablecoin-NG could equal 10 Nigerian Naira; that reduces ambiguity and makes the conversion localized.
It is possible very soon we will see a crypto linked to the Nigerian Naira for Facebook users in Nigeria. How? It is simple: if Facebook can make one tied to US dollars, it can easily translate that to the Naira. Possibly, Facebook would emerge as the operating system for consumer blockchain ecosystem for the next Internet. Facebook has the scale to make any coin an immediate winner in the world.
In this videocast, I discuss the need to build a truly pan-African digital remittance/transfer banking product which is agnostic of location or currency in Africa. None of the products we have today meets that standard. Largely, I envisage a situation where all you need to buy and sell across Africa is one bank account in just one African Union country. With that, you do not have to even think about the specific currency of that account as technology will seamlessly make it possible to access other African markets for payments, transfer etc. The banks or fintech companies must still comply with all regulations related to inter-national transfers, forex etc. The only difference is that customers will not see them as they will be hidden with technology.
A ‘currency” that works in any country unbounded by location where all inter-border money transfer rules have been internally accommodated in software will anchor the next evolution of WhatsApp. Yes, Facebook can build a great business without the worries of invading user privacy to sell adverts. Simply, WhatsApp can become the global operating system for remittance and money transfer, locally and internationally.
WhatsApp remittance services anchored on Facebook stablecoin will be huge. Yes, by linking all flavors of local stablecoins to the national currencies, Facebook through WhatsApp will build the modern unified currency of the 21st century. I am not sure anything can be more disruptive in modern banking and financial services if the company executes this vision. African fintech companies should watch out well, and find ways to build moats where possible before this happens.
Stablecoins are digital currencies pegged to a stable asset, such as gold or fiat currencies, or backed by collateral (that could also be a cryptocurrency), or even an algorithm that governs the approach to expanding and contracting the money supply. The goal of every stablecoin project is to achieve the scale and adoption of modern monetary systems, as a store of value and also as a medium of exchange.