Barclays Analyst Says Facebook Cryptocurrency Push Could Generate $19 Billion by 2021

Marco Green
March 14, 2019

Plus, the company does not have to bear the brunt of the burden when it comes to the interchange cost.

A recent CNBC report is alleging that Facebook could generate numerous billions worth of dollars in revenue from a cryptocurrency. As reported, Ross Sandler, Barclays' analyst has sent notes to the firm's clients. Facebook sees a similar revenue-generating trend through its 3 billion user by 2021. Moreover, Sandler suggests that Facebook could be interested in establishing a cryptocurrency due to the fresh revenue stream it would represent.

It is no secret that Facebook is reportedly developing its own cryptocurrency.

WhatsApp cryptocurrency can debut in India's remittances market, where about 200 million people use the application, as per a Bloomberg's report.

As a result, financial veterans are perceiving the news as a constructive development that could cushion the company's share price that slinked on a flurry of high-profile scandals during the past couple of months.

By "2018's problems", Sandler is referring to the slump in crypto-prices. While Facebook will have its hands full in initiating a smooth launch for the stablecoin and securing adoption for its near 3 billion platform users, its worst-case scenario still appears profitable according to the banking analyst.

The company's currency business model became the talk of the town past year, especially after a scandal related to British political consulting firm Cambridge Analytica broke hell. This is why decentralized companies are better, folks. FB's shares are now trading close to $172, as this year they've rallied roughly 30%. Sandler says that a new revenue option is something "sorely needed at this stage of the company's narrative".

Facebook stretching its revenue sources into cryptocurrency looks promising, as it will not abuse users' privacy.

Barclays has based its revenue estimates off of Google's digital distribution service which is also called Google Play, the official app store for Android. According to him, Google gets at least $6 Dollars per user with the program and Facebook could also earn a lot with its users by making this strategy something real. Also, those were the early days of Facebook and the company is a much more established name now, compared to what it was back when the decade started.

There was disappointment among some in the cryptocurrency world when it was suggested that any Facebook Coin would be pegged to an old-fashioned currency such as the U.S. dollar - but according to Mr Sandler, this misses the point. This time around, however, Sandler believes that Facebook will find much more success as it has assembled a powerful team of blockchain and payments processing experts including the former president of PayPal David Marcus. Each credit was expected to cost $0.10.

Thus, Sandler believes that the launch would not only bring in extra revenue to the company but also impact the value of its shares on a positive note.

Other reports by Click Lancashire

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