This is frankly huge news. Coinbase is one of the world’s biggest and most notorious cryptocurrency exchanges.
Today, we have seen news that states (from Facebook directly) the company have lifted their blanket ban on cryptocurrency advertising. As a result of this, they are now going to allow cryptocurrency products and services to be advertising on their medium once again, so long as they fulfil a set list of criteria. These criteria stipulate that ICO advertisements will still be banned.
This decision has now kick started a rumour mill that seems to suggest that Facebook could possibly have two major motivations for this decision. Firstly, they could be making their own cryptocurrency and secondly, they could be looking to purchase Coinbase, a rumour that did surface via The Economist at the start of June.
See the full article for yourself, here-
According to The Economist:
“Seeing little opportunity to compete with the tech giants on their own turf, investors and start-ups are going where they can spot an opening. The lack of an incumbent giant is one reason why there is so much investor enthusiasm for crypto-currencies and for synthetic biology today. But the giants are starting to pay more attention. There are rumours Facebook wants to buy Coinbase, a cryptocurrency firm.”
Now, The Independent, have also weighed in on the rumour, according to the Independent:
“Experts say that not only could the acquisition boost Facebook’s value and utility, the involvement of the technology giant would add legitimacy to cryptocurrency markets. ‘It wouldn’t surprise me if Facebook made an attempt to acquire Coinbase,’ tech entrepreneur Oliver Isaacs told The Independent. ‘Whether [Coinbase CEO] Brian Armstrong and the team would agree is another question.’ Coinbase did not respond to a request for comment about a potential acquisition but Mr Armstrong has previously stated his firm’s ambitions of seeing cryptocurrency adoption reach a billion people.”
You can see the full article for yourself, here-
Are Facebook really going to take over Coinbase?
We can’t be sure just yet, and even so, I don’t really think lifting their ban on cryptocurrency advertising is a step in this direction. If Facebook wanted to take over Coinbase, they would do it anyway, regardless of their own advertising restrictions because really, it’s not like Coinbase would be built into Facebook as a social network, they two entities would remain separate, it’s just that Facebook would be making some extra money from Coinbase fee’s. In theory at least.
Other implications of this could also involve Ripple XRP, the currency fighting to get a listing on Coinbase. With Ethereum Classic next to be added, we know Coinbase are looking to generate more listings, but as we know, problems surrounding Ripple’s ownership of XRP is calling XRP into question. A security-based question that is stopping XRP getting that shining listing.
If Facebook take over Coinbase however, could they make changes that would see Ripple XRP listed on the exchange? Moreover, if Facebook take over Coinbase and decide to make their own cryptocurrency, would it become a rival of Ripple XRP and thus, could Facebook ensure that Ripple XRP never sees a Coinbase listing?
This is all speculation, obviously. But, it is worth thinking about.