March 27, 2019

motek 1

The article was written by Motek Moyen Research Seeking Alpha’s #1 Writer on Long Ideas and #2 in Technology – Senior Analyst at I Know First.

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לפייסבוק יש למעלה 2,200,000,000 משתמשים פעילים חודשיים. כשמוסיפים את המשתמשים של ה- Instagram  ו WhatsApp פירושו שלפייסבוק יש כמעט 3,500,000,000 משתמשי בסיס. צוקרברג מודע לכך ולכן מתכנן להחליף את הביטקוין הקיים במטבע וירטואלי מיוחד לענקית המדיה .הצפנה זו תציע למשתמשי פייסבוק חלופה בטוחה אף יותר מ- Bitcoin לטענת פייסבוק. פייסבוק כרגע לא באמת  יכולה להתחרות בכמות של מטבע הביטקוין הקיים, אל להוות אלטרנטיבה, פחות תנודתית. ( המטבע החדש יהיה stablecoin   כלומר צמוד לשער הדולר) שיהווה אמצעי תשלום בעסקאות בינלאומיות, קנייה גלובלית, והעברות כספים.  
האנליסטים של I Know First   מחזיקים בדעה חיובית על פייסבוק וממליצים עליה במגמת קנייה טווח הארוך.

Mark Zuckerberg’s long blog post announcing his aim to make Facebook (FB) more privacy-focused convinced me that the upcoming Stablecoin will eventually become a potent blockchain currency/finance platform. Facebook’s Stablecoin can offer people and corporations an alternative to Bitcoin and other volatile cryptocurrencies. Going forward, Stablecoin can become a rival of the U.S. dollar when it comes to online shopping and international trade.

The future financial benefits of operating its own digital currency is obvious. Stablecoin can become a de facto currency in mobile shopping among Facebook/Instagram/WhatsApp users. Statista estimated that mobile retail commerce last year was worth $669 billion.

(Source: Statista)

Take note that a dedicated impulse “buy button” has been available on Instagram since 2016. The new Checkout shopping feature will allow Instagram users to never leave the app when it comes to buying items online. A Stablecoin wallet can be Instagram’s next mobile shopping killer feature.

The bottomline is Facebook can make tons of money supplying digital wallets to mobile shoppers on its mobile apps (and WhatsApp and Instagram). In the United States, Business-to-Consumers (B2C) digital payments transactions amounted to $605.332 billion last year. Sadly, most of those customers likely paid through credit cards and PayPal (PYPL).

(Source: Statista)

My takeaway is that Facebook is already a giant in B2C advertising that it can start muscling its corporate customers to also start backing Stablecoin. A blockchain currency is privacy-centric which could help companies save on excessive government sales taxes. By selling goods on the Stablecoin platform, small and big corporations can likely improve margins. This is by eliminating the pricey transaction fees of credit card companies and PayPal.

By operating the Stablecoin blockchain currency/trading platform, Facebook can afford to charge as low as 0.5% per transaction. This can lead to 0.5% x $605 billion equals $3.025 billion in potential new annual revenue. That is just for the United States. Facebook has billions of users in more than 150 countries. The bottom line is Facebook’s global ubiquity makes it an efficient global B2C platform.

The global B2C e-commerce transactions was worth $2.1 trillion last year. This amount can still grow much higher because the average country e-commerce penetration rate is only 37%. The massive potential in e-commerce is why Zuckerberg is confident in making Facebook more privacy-centric. He can afford to make Facebook a walled-in private garden once his company has its own global currency for the global e-commerce trade.

Stablecoin Can Save Facebook from Its Advertising-dependency

Operating its own digital currency can be a bigger growth driver than digital advertising. Stablecoin will fortify Facebook’s presence in mobile e-commerce and global money transfer. Facebook and its subsidiaries Instagram and WhatsApp tout more than 3.5 billion monthly active users. These people are all potential users of the upcoming Stablecoin wallet.

Facebook has more than $41 billion in cash and short-term investments and quarterly free cash flow of $2.4 billion. It has the cash assets that can act as a reserve to back up Stablecoin. The liquidity and strong cash flow of Facebook can really make Stablecoin a non-volatile cryptocurrency.

A non-volatile encrypted digital currency can be an alternative to the U.S. dollar for cross-border payments/money remittances. The high 5% to 10% fee on traditional electronic money transfer means digital payments is the emerging de facto process. The digital payments industry is growing at 25.1% CAGR. Digital still accounts for less than 7% of all global money transfer/payments. Facebook’s Stablecoin can become a worthy challenger to PayPal and other leading digital wallet companies.

For 2017, the total estimated remittances global market size is $1.025 trillion.  My fearless forecast is that Stablecoin can become a $500 billion cryptocurrency after most of Facebook, Instagram, and WhatsApp’s 3.5 billion monthly active users start using it.

The secrecy of Stablecoin is a great selling feature. It can people hide some of their wealth from greedy tax collectors. I will be among the first people that will acquire a Stablecoin wallet. It’s much safer than owning a Bitcoin or Ethereum wallet.


Facebook’s stock touts a YTD return of  26.55%. I am still endorsing it as a strong buy. The upcoming implementation of Stablecoin compliments Facebook’s emerging interest in online/mobile e-commerce. Facebook has a robust digital advertising business that is still growing. It is generating enough cash to finance its expansion in blockchain cryptocurrency and e-commerce.

(Source: Seeking Alpha)

My strong buy rating for FB is backed by its very bullish 1-year market trend forecast score of 318.85. The stock-picking AI of I Know First is highly confident that FB’s price has excessive probability of going up within the next 12 months.

How to interpret this diagram.

Past I Know First Success with Facebook Stock Forecast

I Know First has been bullish on FB’s shares in past forecasts. On January 29, 2019, the I Know First algorithm issued a bullish 30 days and 3 months forecast for FB, the algorithm successfully forecasted the movement of the FB share. Until today, FB’s shares have risen by 13.70% in line with the I Know First algorithm’s forecast. See chart below.