Yesterday, one of the top subjects of conversation on Bitcoin Twitter was initiated when investor Alistair Milne claimed there is a rumor that Facebook will announce they hold bitcoin on their books on Wednesday.
According to Statista, Facebook is the most widely-used social media application in the world, but there is a certain segment of the population that absolutely loathes this tech giant.
There have been many other user privacy snafus that have popped up for the social media giant over the years, but the point is that all of these issues involve personal data being placed in the hands of a trusted third party, Facebook, which is a problem Bitcoin proponents understand quite well.
Facebook seems to have a renewed push for user privacy and data security every few years, but buying, using, and promoting bitcoin could do wonders for their credibility when it comes to their statements in regards to user sovereignty on Facebook’s platforms. The pressure on Facebook related to these issues is also likely on the rise thanks to Apple, which has launched a wide variety of privacy-enhancing features over the past couple of years that allow users of Apple devices to retain more control over their data.
Additionally, Diem is intended to track the value of the US dollar, which means it’s quite similar to many of the various tools for online payments that already exist in the United States.
If these requirements did not exist, people would already be moving dollars, euros, and other fiat currencies around the world as easily as a tweet or an email.
This is the key differentiator with bitcoin and the reason it is able to operate as a form of digital cash.
If Facebook continues to pursue Diem in lieu of Bitcoin, it will be clear that this step into the digital currency realm is just another power grab rather than a new way to empower their users.
For those ready to point out that Bitcoin cannot scale to handle the entire Facebook user base today, it’s important to realize that every Facebook user is not going to immediately start making Bitcoin payments the day they theoretically go live.
The third reason Facebook should buy and hold some bitcoin on their books is a pretty simply one: pumponomics.
However, the point is not to pump and then dump.
Additionally, Facebook will need for there to be enough liquidity in a cryptocurrency for them to eventually convert some funds back to US dollars, if necessary.
The social media giant can continue to cling onto centralized control or begin to embrace a future internet that is more decentralized and enables true user sovereignty.