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Barclays Ross Sandler Says Facebook Cryptocurrency Could Be $19 Billion Revenue Opportunity


British multinational investment bank and financial service company Barclays internet analyst Ross Sandler forecasted by 2021 the social media giant Facebook get additional revenue of $19 billion if its cryptocurrency work out according to their plan. Barclay’s internet analyst Ross Sandler explains that aside from advertising the payment system could develop a new stream which is “sorely needed at this stage of the company’s narrative.”

The social media giant Facebook is reportedly developing a cryptocurrency for global payments which will be available to use through WhatsApp. The payments will be tied to the value of conservative currencies.

The major roadblock for the global adoption of first generation cryptocurrency as a reliable payment option is the price volatility. Whereas for Facebook Stablecoin have fixed price which is tied to non-volatile currency.

Facebook’s Cambridge Analytica issue and Cryptocurrency ad ban led to a dip in the shares of Facebook. Social media giant’s new business model expanding into payments could generate a hike in the revenue option — something "sorely needed at this stage of the company's narrative," Sandler said.

"Any attempt to build out revenue streams outside of advertising, especially those that don't abuse user privacy are likely to be well-received by Facebook's shareholders," Sandler added.

Sandler pointed to Facebook’s earlier attempts to create cryptocurrency. A California based company Menlo Park created a virtual currency in 2010 called "Facebook credits." According to Sandler’s opinion the major drawback was that the interchange coat was bore by Facebook "which negatively impacts the profitability of the business, especially when making high volumes of lower-value transactions."

Facebook has been always ambitious to build its own cryptocurrency and it built its blockchain team and hired a group of employees from start-up Chainspace.

Facebook has to overcome the challenges by demonstrating value proposition for users "above what is available today in payments" and build trust among its clients and investors. Also, it has to overcome regulatory scrutiny that come with global payments systems. But if the Facebook stable coin proves to be successful, then there is no reason to limit Facebook coin to eventually serve physical payments, remittance, lending.