Facebook Says It Wants a 'Fair Shot' In the Crypto Payments Sphere (nytimes.com) 44
An anonymous reader quotes a report from The New York Times: Facebook's mission is to "bring the world closer together." Increasingly, that's about not just connecting friends and family to share messages, but also serving as a platform for people's financial lives. Some $100 billion in payments have been enabled by Facebook over the past year, said David Marcus, who runs the company's financial services unit. But that's just the start of the social network's ambitions in the finance industry, Mr. Marcus writes in a new memo about the country's "broken" payments system, reported in the DealBook newsletter.
At the center of Facebook's push into payments is Novi, a digital wallet intended for users to move money around the world quickly and cheaply (free, in many cases). The company had a plan to pair it with a "stablecoin" cryptocurrency called Libra, but that was shelved amid regulatory scrutiny, and now the scaled-back project, known as Diem, is overseen by an outside nonprofit group seeking the necessary government approvals. In recounting some of Facebook's setbacks in trying to break into the crypto payments industry, Mr. Marcus describes the tech giant, the subject of antitrust inquiries around the world, as an underdog. Facebook faces unfair resistance in the financial industry, he wrote. "I've heard multiple conversations about how this proposal would be so great if only Facebook wasn't involved," he said. "I understand and accept the need for extra scrutiny due to our scale." But Mr. Marcus describes Facebook as a "challenger in the payments industry," with no specific plan yet to monetize use of the Novi wallet, which won't charge for person-to-person payments, even across borders.
He added that allowing users to pay with dollars, euros and other fiat currencies via the Novi wallet would bring a lot of value. "So why not just do that and call it a day?" he wrote. "Well, we might." But before deciding on that, he doesn't want to "waste our shot" at incorporating stablecoins into an "open, interoperable protocol" for online payments. "To have the maximum impact, building a closed system using fiat only wasn't going to cut it," he said in the memo. Mr. Marcus believes that a well-designed stablecoin pegged to a fiat currency, backed one to one in cash reserves, could offer strong consumer protections. It would also provide quicker access to funds than traditional bank accounts. "We will continue to persevere and demonstrate we can be a trusted player in this industry," he wrote, adding that the Novi wallet has licenses or approvals in nearly every U.S. state and that the Diem stablecoin project "has addressed every legitimate concern." Facebook's digital wallet is ready to come to market, Mr. Marcus said, and "we deserve a fair shot." To judge by Facebook's difficulties getting to this point, regulators remain to be convinced.
At the center of Facebook's push into payments is Novi, a digital wallet intended for users to move money around the world quickly and cheaply (free, in many cases). The company had a plan to pair it with a "stablecoin" cryptocurrency called Libra, but that was shelved amid regulatory scrutiny, and now the scaled-back project, known as Diem, is overseen by an outside nonprofit group seeking the necessary government approvals. In recounting some of Facebook's setbacks in trying to break into the crypto payments industry, Mr. Marcus describes the tech giant, the subject of antitrust inquiries around the world, as an underdog. Facebook faces unfair resistance in the financial industry, he wrote. "I've heard multiple conversations about how this proposal would be so great if only Facebook wasn't involved," he said. "I understand and accept the need for extra scrutiny due to our scale." But Mr. Marcus describes Facebook as a "challenger in the payments industry," with no specific plan yet to monetize use of the Novi wallet, which won't charge for person-to-person payments, even across borders.
He added that allowing users to pay with dollars, euros and other fiat currencies via the Novi wallet would bring a lot of value. "So why not just do that and call it a day?" he wrote. "Well, we might." But before deciding on that, he doesn't want to "waste our shot" at incorporating stablecoins into an "open, interoperable protocol" for online payments. "To have the maximum impact, building a closed system using fiat only wasn't going to cut it," he said in the memo. Mr. Marcus believes that a well-designed stablecoin pegged to a fiat currency, backed one to one in cash reserves, could offer strong consumer protections. It would also provide quicker access to funds than traditional bank accounts. "We will continue to persevere and demonstrate we can be a trusted player in this industry," he wrote, adding that the Novi wallet has licenses or approvals in nearly every U.S. state and that the Diem stablecoin project "has addressed every legitimate concern." Facebook's digital wallet is ready to come to market, Mr. Marcus said, and "we deserve a fair shot." To judge by Facebook's difficulties getting to this point, regulators remain to be convinced.
Wounded. (Score:5, Funny)
"Fair shot" is about right. So will this be in the head, or in the gut?
Re:Wounded. (Score:5, Insightful)
Re: (Score:2)
Re: Fact check your check book. (Score:2)
âoeUnpopular with the fact checkersâ I think you meant incitement of riot and insurrection.
Re: Fact check your check book. (Score:2)
Taliban should be banned too.
Election wasnâ(TM)t fraudulent. Youâ(TM)re just dumb.
Re: (Score:2)
When I read the headline, I thought, "Facebook is suffering? Great!"
Then I thought, "Facebook is fighting against banks? Banks are eviler than Facebook! Great!"
Whoever loses, we all win.
Re: (Score:3)
"Fair shot" is about right. So will this be in the head, or in the gut?
How about straight to the zucks?
Re: (Score:2)
Personally I think it would be too quick for the Zuck, but as an average for people who have taken the Facebook shilling it may be about right.
Never Use This Tripe (Score:5, Insightful)
Facebook? My finances? Not likely (Score:5, Insightful)
I'm not going to allow Facebook anywhere near my finances. It's bad enough that our online purchases are tracked so they can monetize the information for advertising, but do you really want Facebook knowing who you send money to?
But there are enough people that think blending social media and finances (e.g. Venmo) is a good thing that I'm sure FB would have a lot of customers.
Facebook bank is not an bank and not FIDC (Score:2)
Facebook bank is not an bank and not part of FIDC.
Banks certainly have problems (Score:5, Informative)
But when it comes to my money, I’ll still pick a bank over Facebook (or PayPal, or $INSERTTECHCOMPANYNAME) any day of the week.
Banks need a payments network (Score:1)
Re: (Score:1)
Smaller businesses, like mine, should easily be able to. I do credit card transactions and have a couple customers who pay me through Zelle. Maybe corporations don't want to deal with it.
Re: (Score:2)
Re: (Score:2)
Hmm when I do a search for “zelle business account”, I see a lot of results from banks (e.g. Chase, Wells-Fargo, BoA) at least claiming businesses can send and receive payments that way.
I just wish they’d take it world-wide.
Re: Banks need a payments network (Score:2)
Zelle and all the similar services world wide are national.
We need a global no chargeback payment system. It's chargebacks which give credit cards and paypall the need to assign risk to businesses, which they then use as an excuse for censorship (with a little push from Obama along the way).
Except one thing that FB doesn't want to admit (Score:2)
Facebook could force/steer it's customers to use it's currents. It's better to cut them off from this abuse of power before it get's out of hand.
Sucks to be you (Score:2)
Facebook is it (Score:2)
Yeah, when I think crypto payments, I want a company that has a proven track record of respecting privacy. Congratulations, Facebook. You're about the bottom of that list. Might as well have Google do it. Too bad when 3 years later they shut down the whole thing.
Bullshit. (Score:5, Insightful)
Facebook doesn't want "fair" anything. Facebook wants leverage and information. If any business says they want something to be "fair" then I can name a business that has just lied to you. Fuck Facebook, they can burn in hell.
Re: (Score:3)
Yes, what they mean is they want to screw everyone, but now everyone is wise to the fact that they will screw everyone and so they have issues screwing everyone. If they were a brand new company without a long history of screwing people over, they wouldn't immediately have people assuming they will screw everyone over. They want the benefit of the doubt that they won't screw people over, so they can successfully screw people over. For them fair is that benefit of the doubt.
Privacy Rapist's "broken payments system" (Score:2, Informative)
Mr. Marcus writes in a new memo about the country's "broken" payments system
Yeah, because the first world problem here is FB's "broken payments system" - nothing about its entire business model being totally defective and abusive or anything, no!
Nobody actually likes your company (Score:1)
Face it guys, nobody likes your Facebook company. Even if people use your product, that doesn't mean they like you. It just means they don't have a lot of options.
We've got better options than the hot garbage you are trying to pass off as money.
Why? (Score:2)
I thought they were in the business of selling ads to retards.
Marcus is either stupid or a liar (Score:5, Insightful)
"I've heard multiple conversations about how this proposal would be so great if only Facebook wasn't involved," he said. "I understand and accept the need for extra scrutiny due to our scale."
It has nothing to do with "scale", asshole. Facebook has proven time and again that it can't even be trusted not to misappropriate people's personal data, and that it is wiling to fuck with their very well-being in the name of profit. Why would other companies, or regulators, trust your company with people's actual money?
Re: (Score:2)
Very well said. I could not agree more. /tiphat
Facebook is a cesspool (Score:2)
A "fair shot"? A fair shot would be to bury this filthy organisation for its repeated large-scale data breaches. It's is both laughable and massively insulting that Facebook thinks they should be trusted with financial info when they can't even stop half a billion users' data being leaked. Yeah, "billion" with "B.": https://www.npr.org/2021/04/09... [npr.org]
What's even more telling, is that when I put "facebook data breach" into duckduckgo, the search engine suggested "facebook data breach 2017," "facebook data brea
Spending Habits (Score:2)
Facebook is an advertising platform that uses psychological profiling and manipulation, coupled with deep knowledge about its user base, to squeeze money from people and turn a profit.
At the moment their sphere of influence is somewhat limited to their own platform, and other platforms where they have beacons embedded on other web sites, allowing them not merely to know what sites you visit, but to understand the sequence
Any time FB wants a "fair shot"... (Score:1)
They're lying. Because they want to corner the business and maintain absolute, unquestioned control.
Social Media companies are already too powerful and control too much data.
Allowing them control over currency, analog, digital, crypto? It's societal hara kiri (seppuku).
New slogan: (Score:1)
"Share your financial misadventures with friends and family!"
They just want a fair shot (Score:2)
They just want a fair shot. And if they have to lie, cheat and steal to get it, well that is just the cost of doing business.
Facebook can go ⦠(Score:1)
Legal Not Technical Problem (Score:3)
This is ridiculous. The problem that facebook is solving is a legal one not a technical one.
It would be absolutely trivial to just create a banking website that allowed users to sign up for anonymous numbered accounts and transfer money between them. It wouldn't involve any complicated mining, crypto or overhead so it could be cheap as dirty and solve the problem of high overheads for remittances and similar transfers that facebook is trying to fix.
The only reason this doesn't exist is it's super illegal. Know your customer laws prevent banks from offering just anyone an account as then terrorists and money launderers could exploit those. And while I absolutely understand the concern that's no excuse, imo, to put in place laws which essentially deny free/cheap banking services to a huge fraction of the world's population especially when, such laws push people into using even harder to monitor psuedo-banking arrangements like Hawala.
But we should either just bite the bullet and repeal/relax know your customer laws so everyone can compete to offer services to the unbanked or apply the same rules to cryptocurrency. There is no reason that facebook should be allowed to offer the same services that would be illegal for a traditional financial institution just because it calls it cryptocurrency rather than a bank account.
Re: (Score:2)
Note that such accounts would equally well solve the original use case for bitcoin: buying drugs etc online (not a knock....absolutely believe this is an important use). An anonymous numbered account created online would be just as useful for those purposes as BC.
Oooooh, poor liddle Facebook wants a fair shot ... (Score:2)
... soooo sad. Gonna cry?
what about... (Score:1)
When your facebook account gets banned because facebook arbitrarily decides to. Happened to so many people with an Oculus rift. Social media and their crazy moderators should not be in charge of who can pay for their groceries online or whatever. They should stay far away from payments industry.
I cringe at the hypocrisy (Score:1)
Players Rightfully Worried FB Wants to be WeChat (Score:2)