Facebook has reportedly enlisted the support of a dozen organizations to underpin its cryptocurrency project and help keep the social media giant honest.
The majority of the blockchain project is being kept firmly under wraps, though the Wall Street Journal is reporting numerous technology heavyweights have been convinced to support the efforts. The likes of Uber, Visa, PayPal and Booking.com will allegedly each contribute $10 million to the project and then form a governance body which will oversee the cryptocurrency.
For the last year, Facebook has been working on the blockchain project to create its own digital currency. The digital currency will certainly help encourage more transactions on the social media platform, as well as enable Facebook to reach out to potential customers who do not have traditional bank accounts. Facebook has also claimed the creation of such an asset helps it to pivot to an organization which is more defined by privacy.
While the financial contributions towards the project and the governing body would be welcomed by Facebook, the support of these respected brands also tackles another challenge the social media firm is facing; trust and credibility.
Thanks to a few high-profile scandals and renewed enthusiasm across the world to tackle the data privacy violations from Silicon Valley, Facebook is lacking credibility. Mark Zuckerberg has been exposed as somewhat of an emotionless robot during investigations and testimonies, while fresh evidence keeps emerging suggesting the company does not care about the privacy right of its users.
Trust in Facebook is at a low-point at a time when it needs it most. Asking people to trust the firm with their digital profiles is one thing, but then suggesting they trust Facebook to be reliable and responsible with their money is a completely different question.
In bringing on brands which the consumer trusts with money, Facebook is crafting a PR win. The consumer trust in these brands might rub off on the social media giant, while it can also point to the fact its control and influence over the digital currency will be diluted through the presence of an oversight committee. If it turns out to be true, it is a clever move from Facebook.