Does the fact that multiple social media platforms recently banning ads for ICOs of cryptocurrencies mean they are really opposed to digital currencies? All indications point to the contrary. These social media giants may be very interested in cryptocurrency, but may wish to lead the new technology in their own way. That’s a huge thumb’s down for entrepreneurs trying to advertise cryptocurrency on these social channels, but what could these social media giants have in mind?
Facebook banned both cryptocurrencies and related ICO ads in January, claiming it wants to protect its users from possible advertising scams. Many unsophisticated investors have lost a great deal of money due to recent frauds. Other platforms were quick to follow Facebook. Zuckerberg may or may not be looking out for the interest of Facebook users, but signs are he’s looking out for his own interest, as well.
The social media giants have been enthusiastic proponents of the new digital technology. Zuckerberg has posted favorably about it on Facebook, claiming Bitcoin and other cryptocurrencies will allow people more control and power over their financial transactions. A mere two weeks following this seeming endorsement, Facebooks announced its ban on any advertising of same.
Banning ads by social media giants seems to be contradictory, as do their efforts to stifle users’ interest in Blockchain technology that drives the digital currency.
More recently, Facebook has become enmeshed in a very public cyber-scandal, with claims that it has revealed the personal data of 87 million users to a political consulting firm, Cambridge Analytica. Facebook users rightly expressed their outrage. Could Facebook be looking to combat this publish backlash by developing some sort of facebook blockchain to strengthen transparency and privacy? Time will tell, but Zuck has definitely been a fan of the cryptocurrency revolution.
In March, Jack Dorsey, CEO of Twitter, has enthusiastically said that Bitcoin, whose ads he has banned from his platform, will probably become the global currency in less than a decade. Dorsey praised the possibility of a single world currency. As interest in Bitcoin grows, there will be a tremendous need for error-free processing of digital currency. Jack Dorsey enthuses about cryptocurrency but is banning all relevant advertising.
The recent ban on cryptocurrency ads might be confusing unless one peaks beneath the layers of verbiage. Is protecting users against digital fraud the only reason for the advertising ban?
It is certainly the stated reason, especially in the wake of dubious ads meant to deceive possible investors. In response to the ban, Bitcoin’s price fell below $8,000 from its high of $19,000 last December. Yet Facebook stands by its decision to demand greater integrity in its advertising, a long-term plan to regain the trust of its users in the face of the recent Cambridge Analytica scandal. Zuckerberg has indicated that he has plans to study and explore blockchain technology and how to best utilize it for Facebook. In theory, blockchain technology could circumvent digital censorship, especially in countries such as China, where social media are regularly censored.
Is Zuckerberg quietly planning on creating a cryptocurrency of his own? If so, it might unravel the puzzle to the advertising ban. By distancing himself from recent digital payment scams, he may wish to start over with a clean slate with a more unblemished reputation. With 1.86 billion users, Facebook’s launch of an ICO for its own cryptocurrency could stimulate tremendous interest. The company is already heavily invested in peer-to-peer payments similar to WeChat being used in China. Perfecting the use of digital payment platforms ahead of its rivals would give it a boost in the race for blockchain technology supremacy.
Google and Goldman Sachs are two of the largest investors in blockchain technology. Alphabet and Ripple, are actively working on making the technology viable to a large userbase.
The interest in digital currency is rising exponentially. The number of companies offering ICOs in blockchain technology is growing. In 2016, there was $545 million worth of offerings. This rose to $830 million in 2017. Clearly, megadeals are in the works. In 2017, lots of startups offered blockchain ICOs. There is a high failure risk among these companies. Not everyone will come out a winner. But the social media giants seem to be strategically positioning themselves for future success, and the one with the best platform will undoubtedly lead the way. The winner could affect the future of currency and global trade transactions.