• November 29, 2020

After Chainspace, Facebook continues its crypto startup acquisitions

After Chainspace, Facebook continues its crypto startup acquisitions

Recently we saw that Facebook has reportedly acquired crypto startup – Chainspace. But the acquisition game for social media company doesn’t stop there and has been eyeing many other blockchain startups.

Who’s in Shopping List of Facebook?

Per reports from The Information, there are at least three startups which are in the acquisition list of Facebook. These include Algorand, Basis, and Keybase.

A few months back, the company was in discussion with stablecoin startup Basis. Soon after that, the company had to shut down due to regulatory concerns. Coincidentally, at the same time, the social media giant was said to be developing the stablecoin for use in payments on WhatsApp. Specifically, Facebook was planning to roll out the money transfer service in India where WhatsApp has over 200 million users.

With respect to, Keybase a encrypted messaging app that supports Bitcoin and Zcash wallet addresses, the acquisition talks were going on in early last year. But appears that nothing came through.

Scalability becomes Prime factor for Acquisition

When it comes to acquisition, the social media firm is in discussion with those companies which can scale up with its plan to release cryptocurrency of its own on its various platforms.

Perhaps the very reason behind this would be to avoid the same mistakes which Bitcoin and Ethereum faced when exposed huge numbers of users. These blockchain networks encountered slow processing times and high transaction fees after a sporadic rise in user numbers.

Looking at above consideration Facebook might end up finalizing the deal with Chainspace and Algorand as they can solve problem of scalability for billions of users.

What do you think on Facebook acquisition of crypto startups? Share your thoughts in the comment section below.

Finance

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