Facebook Reportedly Raising $1 Billion for New Crypto Project

Facebook VC funding cryptocurrency stablecoin blockchain

Social media giant Facebook is reportedly looking to raise $1 billion in fresh funding to support a new cryptocurrency project, according to reports emerging today.

First reported in the New York Times, sources close to the company have confirmed the firm is turning to venture capital funding to secure “big sums” in order to support a new stablecoin project.

Facebook is thought to be planning to use the funds as collateral for backing their token, which would ensure it maintains stable value against a pegged fiat currency.

The reports at this stage have yet to be confirmed or denied by Facebook, but sources close to the firm have been suggesting the company is preparing a significant move in crypto for some time.

Back in December, it was revealed that Facebook had been developing a stablecoin for use in its WhatsApp messaging product, which would enable users to send money directly peer-to-peer over the platform.

At the time, it was reported that the stablecoin would be pegged to the value of a basket of international fiat currencies. Since then, Facebook has said it would be listing a stablecoin on cryptocurrency exchanges around the world, advising platforms its coin would be ready by the second half of this year.

According to CNBC, Facebook had as much as $44 billion in cash reserves in April 2018. While Facebook is far from lacking in cash reserves of its own, sources suggest it is seeking external funding to ensure the stablecoin appears less centralized and controlled by the company.

Facebook’s cryptocurrency play is expected to be a big earner for the firm, with analysts at Barclays suggesting the stablecoin project could generate revenues of as much as $19 billion a year by 2021.

The project is the product of the firm’s blockchain team, set up in May 2018 to work on R&D around cryptocurrency and blockchain. Since then, Facebook has been aggressively hiring blockchain talent, with as many as 20 open positions currently advertised.

With the stablecoin project now reportedly ready for investment, it’s expected to prove an irresistible proposition for venture capitalists with an interest in the cryptocurrency space.