Amid the blockchain and cryptocurrency rumors surrounding social media giant Facebook, the company has now denied being in talks with cryptocurrency firm Stellar.
Just a rumor
On Friday, 10 July, Business Insider published a report claiming that David Marcus, former PayPal executive who leads Facebook’s blockchain team, had met with Stellar to discuss potential uses.
According to the report, the unnamed Stellar source claimed it would “make sense for Facebook to record payment transactions on a distributed ledger like Stellar”. The source added, “They’d be taking the rug out from under the banks… They can add a bank more quickly than a bank could build a social network.”
However, it didn’t take particularly long for the explosive rumor to reach Facebook, prompting a swift response. Speaking with financial outlet Cheddar, a spokesperson said, “We are not engaged in any discussions with Stellar, and we are not considering building on their technology.”
The crypto markets responded appropriately during the period of this report, while Stellar’s cryptocurrency called Lumens jumped up approximately 10% on the world’s largest crypto exchange, Binance.
The Stellar discussion alone is not the only factor to consider in the Facebook rumor mill; a day later it was reported again by Business Insider, that David Marcus had announced his departure from the Coinbase board.
Speaking with CoinDesk, Marcus explained, “Because of the new group I’m setting up at Facebook around blockchain.” A Coinbase representative also told CoinDesk that Marcus had resigned to “avoid the appearance of a conflict of interest”.
In early May, the social media giant announced the founding of its blockchain technology research team, the sole purpose of which is to research the potential uses of blockchain technology on Facebook.
It was again in the spotlight in mid-May, after another anonymous source had made claims that Facebook was indeed considering the creation of its own cryptocurrency.
However, at that time of reporting, Marcus denied those claims on the basis of cryptocurrency payments being “very expensive” and “super slow”, though he does mull the prospect of maybe doing something after Facebook had explored blockchain technology enough.
Moving into early July, Facebook announced the creation of a Director of Engineering Blockchain position, appointing its in-house head of Programmable Languages & Runtimes, Evan Chang to the newly established position. Cheng has also advised projects and startups like ChainLink and Zilliqa.
Then in a partial U-turn, Facebook announced that it would be allowing for Coinbase advertisements to run on the website and Instagram. The timely move came a few short months after Facebook, among others including Google, banned cryptocurrency advertisements on its websites.
The global blockchain and cryptocurrency communities will be watching Facebook very closely it dips its toe in blockchain; however, it is unlikely this will be the last of the whisperings to emerge and be dispelled.
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