In one corner: Twitter’s cofounder and chief executive Jack Dorsey. In the other corner: Facebook’s cofounder and chief executive Mark Zuckerberg. The fight’s prize is the future of money and their respective weapons are bitcoin and libra.
Who will win?
While the social media monetary situation is not this clear cut, both Dorsey and Zuckerberg have emerged as champions of two similar but opposing ideas; the internet needs its own currency, one sees it as centralised, through Facebook, the other sees it as decentralised, through bitcoin.
Zuckerberg appears to have lost the first round. His libra project, a cryptocurrency by name only and governed by an independent-but-shrinking group of companies, has run afoul of governments and regulators around the world, many of which were already worried Facebook wielded too much influence before the social media giant thought to take on the central bankers.
“I believe that this is something that needs to get built,” Zuckerberg told U.S. senators last week, defending Facebook’s involvement in the controversial libra project and arguing libra could bring financial maturity to millions, if not billions, of people around the world.
Zuckerberg also warned the U.S. could fall behind other countries if lawmakers moved to block the development of libra and similar digital money projects.
Dorsey will, meanwhile, be counting his blessings, with the bitcoin price staging a somewhat miraculous recovery last week after many feared it was heading to lows not seen since March.
Dorsey has also made headlines this week by joining a group of investors that are putting a combined $10 million into CoinList, a U.S.-based startup that helps other young companies raise money through digital token sales.
However, bitcoin innovation and adoption have failed to live up to expectations with the two primary uses for bitcoin and other similar digital tokens still price speculation and buying illicit substances on the dark web.
Bitcoin trading volume among the top ten biggest bitcoin and crypto exchanges fell to to under $200 million a day earlier this month, according to bitcoin and crypto data company Messari, down 20-fold from a peak of $4 billion per day just a few months ago.
“Across all crypto venues, volumes are dismal,” eToro’s senior market analyst Mati Greenspan wrote in a Twitter thread, sparking industry concern.
Dorsey wants to see that change and expects bitcoin to become what he has called “the internet’s first native currency” and is well placed to effect that change through his two companies, micro-blogging platform Twitter and payments company Square.
When asked last week if he’d be open to joining Facebook’s libra project, Dorsey replied with an emphatic: “Hell no,” slamming libra as not based on an open standard.
“It was born out of a company’s intention, and it’s not consistent with what I personally believe and what I want our company to stand for,” Dorsey reportedly said, speaking at a New York Twitter event.
And Dorsey isn’t all talk. He launched Square Crypto earlier this year, a division of Square that will work on development on the bitcoin network, hiring bitcoin developer Matt Corallo in August, along with three other software developers poached from Google, Lightning Labs, and Facebook.
“The creation of [bitcoin] was very pure, and focused on a public good, rather than any other particular agenda,” Dorsey told business news and analysis outlet Quartz in June.
“The fact that it’s meant to be deflationary, meant to incentivize savings instead of spending, I think is a net positive for the world and how we think about consuming.”
In a sign the gulf between the two social media companies is growing, Dorsey has revealed Twitter will ban all political advertising worldwide, putting the company at odds with Facebook’s acceptance of them–something that’s likely to be a major issue going into the 2020 U.S. presidential election.
The fight for digital monetary freedom could become swept up in the broader battle for the future of the internet.