Following the news that Meta, the company formerly known as Facebook, is planning a virtual currency and creator coins for its apps;
Dr Lil Read, Analyst in the Thematic Research Team at GlobalData, a leading data and analytics company, offers her view:
“Cryptocurrencies and digital tokens will be cornerstones of what GlobalData recognises as two of the biggest technology themes in the next decade: the metaverse and Web3. By developing in-app tokens, Meta will give users—especially younger Gen Z customers—a reason to stay within its ecosystem. It is essential that Meta stays relevant and attractive to Gen Z in the new era of social media, or it risks being left behind.”
Dr Laura Petrone, Principal Analyst in the Thematic Research Team at GlobalData, offers her view:
“Meta desperately needs to diversify its revenue streams and look for ways to retain customers. It recently admitted that services such as Facebook and Instagram are losing appeal and becoming less popular, especially among young users.
“Meta’s ambition is to become the WeChat of the west, and its move to diversify away from a purely ad-funded model, which is facing regulatory challenges, is another step towards that goal.
“This foray into virtual currency is a much more gradual approach than the failed Libra cryptocurrency project, as a change of approach was inevitable to avoid regulatory scrutiny. The new planned currency is unlikely to be based on blockchain but will use in-app tokens instead—similar to Roblox’s currency system.
“There are also rumors that Meta is also exploring the possibility of providing digital lending services, focusing on small business loans. However, China’s Tencent and Alipay have been doing this for a long time, and this has also attracted scrutiny from regulators.”