Russia-based social media giant Vkontakte (or VK) has launched its own digital currency ahead of Facebook blockchain efforts. According to a report by local news source Tass, VK launched a mineable coin known as VK Coin at the start of April.
This comes at a time when social media giant Facebook is reportedly planning to launch an internal cryptocurrency Facecoin which will be used for its Messaging app Whatsapp and probably extended to the entire Facebook ecosystem. The facecoin is often used to typify Facebook’s blockchain efforts which is rather secretive since the announcement the Facebook blockchain division.
VK Launches a Mineable Coin
Just like it is with Facebook and Facecoin, VK Coin started with speculations that the social media platform was planning to launch a custom cryptocurrency. According to Russian news outlet RNS, the social media platform planned to launch a cryptocurrency that could be shared among users to complement its payment system VK Pay.
How VK Coin Works
VK Coin service works via the app feature of the VK Social media platform. The service which is available to both Android an iOS version of the app allows users to earn VK Coin by clicking in an in-app game and competing for top positions. This process, the issuers describe as ‘mining’.
In this mining process, users generate 0.001 VK Coin each time they click on the button in the app. The VK Coin, when earned, can be shared among users and used to make in-app purchases such as for ‘accelerators’ to boost the coin mining process.
According to information on the VK Pay page, a user has earned over 800 million VK Coin since it was introduced. This may not have much use at the time though.
VK Coin May Not Be A Blockchain-Enabled Cryptocurrency
From indications, VK Coin is not an actual cryptocurrency launched on a blockchain network. It is at best an understudy of how an actual cryptocurrency will be received by its users. The social media giant is reportedly still working towards an actual universal cryptocurrency but will use the current VK Coin to “test the mechanics of obtaining cryptocurrency.”
This will be an interesting prospect given that VK is the biggest social media platform in Russia with about 100 million active monthly users and over 6 billion messages sent daily. Furthermore, VK Coin is launched under its financial service VK Pay which launched mid last year. VK Coin holder will be able to exchange their coins for discounts on ads and third-party services and maybe fiat.
What is Happening with Facebook Blockchain Plans?
Facebook which is one of the world’s biggest social media platform with over 2 billion registered users set the cryptocurrency community abuzz with rumors that it was launching a cryptocurrency token WhatsApp. No details about the so-called Facecoin has been revealed lately.
As Smartereum reported, Facebook gave a huge insight into the nature of its blockchain and cryptocurrency effort which is championed by its new blockchain division. In a description to its prospective blockchain employees, Facebook hinted that its blockchain division will work as a subsidiary to develop blockchain and crypto solutions across sectors—not necessarily related to Facebook and social media.
Other than a Facecoin, Facebook may roll out a blockchain health app or a budgeting app as its first blockchain product.
Solomon Sunny is the market reporter for Smartereum, one of the global leaders in Ethereum, blockchain and currency news. He produces technical price updates on digital currencies and writes recent developments about blockchain.