<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="This article was first published by MyWallSt.” data-reactid=”11″>This article was first published by MyWallSt.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Whenever a radical new technology comes along, there will always be a flurry of people lining up to denounce it as no more than a passing distraction or fad. A quick look at the history of innovation will reveal it to be filled with awful predictions by the gatekeepers of the old order.” data-reactid=”12″>Whenever a radical new technology comes along, there will always be a flurry of people lining up to denounce it as no more than a passing distraction or fad. A quick look at the history of innovation will reveal it to be filled with awful predictions by the gatekeepers of the old order.
In 1903, to take the most famous example, president of Michigan Savings Bank advised against investing in the newly established Ford Motor Company on the grounds that “the horse is here to stay but the automobile is only a novelty.”
Image Source: Eftakher Alam on Unsplash
Of course, it’s not yet clear whether cryptocurrencies will become as ubiquitous a phenomenon as the ‘horseless carriage’, but a good case for its continued survival can be made by looking at how many big businesses have embraced the technology in recent months. Here are three noteworthy examples:
<h3 class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="1. Facebook ” data-reactid=”27″>1. Facebook
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="After lots of speculation, Facebook (NASDAQ: FB)finally revealed the details of its new cryptocurrency platform last week. The project turned out to be far more ambitious than many had anticipated.” data-reactid=”28″>After lots of speculation, Facebook (NASDAQ: FB)finally revealed the details of its new cryptocurrency platform last week. The project turned out to be far more ambitious than many had anticipated.
The platform, codenamed Libra, will allow users to make purchases on Facebook’s apps as well as third-party sites for almost non-existent fees. With more than two billion monthly active users, Facebook’s online community is so large that Libra, at least in principle, could become the world’s most widely used currency.
Apparently all-too-aware of its poor reputation for privacy violations, Facebook has launched a subsidiary company to manage this cryptocurrency called Calibra, which will collect and use data independently of its core business. As a result, there should be no fear that a user’s spending history is being exploited by the social network for targeted advertising (we hope).
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="In order to build further trust, Facebook has also established the Libra Association, a collective of 28 companies that include payment rivals such as Visa (NYSE: V), Mastercard (NYSE: MA), and PayPal (NASDAQ: PYPL). Supposedly, this will allow other independent voices to veto any objectionable decisions made by the Facebook team.” data-reactid=”31″>In order to build further trust, Facebook has also established the Libra Association, a collective of 28 companies that include payment rivals such as Visa (NYSE: V), Mastercard (NYSE: MA), and PayPal (NASDAQ: PYPL). Supposedly, this will allow other independent voices to veto any objectionable decisions made by the Facebook team.
Facebook is no stranger to business failures (remember Facebook Gifts? Neither do we) and Libra is arguably its most ambitious project to date. But whether the global payments revolution it promises will actually take off, or indeed pay off, remains to be seen.
<h3 class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="2. JPMorgan ” data-reactid=”33″>2. JPMorgan
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Despite CEO Jamie Dimon's well-documented disapproval of bitcoin — which in 2017 he declared to be a "fraud" — J.P. Morgan Chase (NYSE: JPM) announced back in February that it would be the first major U.S. bank to launch its own cryptocurrency.” data-reactid=”34″>Despite CEO Jamie Dimon’s well-documented disapproval of bitcoin — which in 2017 he declared to be a “fraud” — J.P. Morgan Chase (NYSE: JPM) announced back in February that it would be the first major U.S. bank to launch its own cryptocurrency.
Inventively branded ‘JPM Coin’, the new currency has already begun trials and will be used by the bank to instantly settle payments between clients.
According to the company’s head of blockchain projects Umar Farooq, there are three early applications that the bank has identified for its new project — international payments for large corporate clients, securities transactions, and replacement for dollars that large treasury services hold in subsidiaries across the world.
Although Dimon predicted that bitcoin would not end well for buyers in October 2017, he would later renege on those comments, saying that there was indeed a future in the blockchain.
In fact, J.P. Morgan’s iteration might be somewhat safer than the bitcoin madness we witnessed back in those speculative days, considering the regulatory hurdles that both the bank and its clients have undergone. In this sense, ‘JPM Coin’ is not an asset like bitcoin that you’ll be able to invest in, but rather an innovative tool that will be used between the bank and its big institutional clients.
<h3 class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="3. Square ” data-reactid=”43″>3. Square
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Social media billionaire Jack Dorsey who founded Twitter (NYSE: TWTR) has also been making inroads into the crypto market via his payments business, Square (NYSE: SQ), and by the sounds of it, the venture is no less ambitious than Facebook’s.” data-reactid=”44″>Social media billionaire Jack Dorsey who founded Twitter (NYSE: TWTR) has also been making inroads into the crypto market via his payments business, Square (NYSE: SQ), and by the sounds of it, the venture is no less ambitious than Facebook’s.
In May, Dorsey said that Crypto Square intends simply to “improve money.” The idea is to build a small team of experts that will make “open source contributions to the bitcoin and crypto ecosystem,” while the main Square app will make it easier to use alternative payments for transactions. The final goal is to make “mass adoption not just possible but inevitable.”
Well aware of the uncertainty surrounding the likes of bitcoin, Dorsey has also emphasized the importance of design in making cryptos more accessible and easier to conceptualize for the uninitiated. And with 113.5 million users projected for 2021, Square might just be able to bring this project into the mainstream.
Dorsey’s vision for the future of currency seems to be an extension of the logic behind Twitter. While the social network aims, at least in theory, to foster better communication across national boundaries, Crypto Square, in his own words, hopes to build “a stateless currency that all people can access” and isn’t “bounded or constrained by any one corporate entity.”
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<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="MyWallSt operates a full disclosure policy. MyWallSt staff currently hold long positions in Facebook, Mastercard, PayPal, and Square. Read our full disclosure policy here. ” data-reactid=”60″>MyWallSt operates a full disclosure policy. MyWallSt staff currently hold long positions in Facebook, Mastercard, PayPal, and Square. Read our full disclosure policy here.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. The Motley Fool owns shares of and recommends Facebook, Mastercard, PayPal Holdings, Square, and Visa. The Motley Fool has a disclosure policy.” data-reactid=”61″>Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. The Motley Fool owns shares of and recommends Facebook, Mastercard, PayPal Holdings, Square, and Visa. The Motley Fool has a disclosure policy.
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