Facebook Buys 10% Stake In Reliance Jio- Will It Affect India’s Cryptocurrency?

Facebook Buys 10% Stake In Reliance Jio– is good news amid nationwide lockdown and coronavirus crisis. The social media giant Facebook announced that on last Wednesday. The investment is about $5.7 billion (Rs 43,574 crore) in Reliance Jio, the largest private sector company in India. It is representing the largest foreign direct investment (FDI) in India’s technology sector. Reliance Jio independently announced on Wednesday:

“This investment by Facebook values Jio Platforms at ₹4.62 lakh crore pre-money enterprise value. Facebook’s investment will translate into a 9.99% equity stake in Jio Platforms.”

Also added, “Reliance Jio’s valuation is approximately “$65.95 billion, assuming a conversion rate of ₹70 to a US dollar.”

Facebook Buys 10% Stake In Reliance Jio- Makes Another Partnership

Facebook buys 10% stake in reliance jio

So, the deal between Reliance Jio and Facebook costs the social media giant approximately 5.7 billion dollars or 435.74 billion rupees at the current exchange rate. Moreover, the deal makes concurrently another partnership between- Jio Platforms, Reliance Retail, and Facebook’s Whatsapp. The social media giant said it would focus on collaborating its messaging platform. And that is mainly for enabling people to connect with small businesses.

Facebook’s investment will translate to a 9.99% equity stake in Jio Platforms on a fully mixed basis, Jio said in a statement. Actually, the deals come at a time when Facebook-owned WhatsApp. As well as, it has approved as a secure platform to roll out its digital payment service in India. According to the media report, these are all to compete with the likes of Google Pay and Paytm.

The market scenario is very simple. WhatsApp has 400 million users in India. So, there is no doubt that is the biggest market and reaching nearly 80% of smartphone users in the country. Reliance Jio, the fast-growing telecom carrier controlled by billionaire Mukesh Ambani, began operations in late 2016.

The Deal- Amid of Nationwide lockdown and COVID 19 crisis

Facebook elaborated that it will work more effectively with Reliance Jio to create new ways for people in India and businesses. Especially in this crisis moment. 

The social media giant emphasized, “In the face of the coronavirus, it is important that we both combat this global pandemic now. And lay the groundwork to help people and businesses in the years to come.” 

“For instance, by bringing together Jiomart, Jio’s small business initiative. With the power of Whatsapp, we can enable people to connect with businesses, shop and ultimately purchase products in a seamless mobile experience.”

Facebook buys 10% stake in reliance jio

Impact On Indian Cryptocurrency

The Indian crypto community is optimistic about the deal between Facebook and Reliance Jio. Last year, Reliance Jio announced its plan to build the largest blockchain network in India. Local regulatory news and analysis outlet Crypto Kanoon broke down the news that Facebook buys 10% stake in Reliance Jio. That indicates the Indian crypto sector. By maintaining privacy, the Reliance Jio and Facebook deal is not a joint venture. Moreover, the two companies will continue to operate independently with their own business models.

Crypto Kanoon noted, “will have a spillover effect” on cryptocurrency as more people in India will start experimenting with digital assets. “There is also going to be a surge in the search for terms like ‘blockchain’ and ‘bitcoin.’”

The Indian cryptocurrency space recently got a boost when the supreme court cancel the banking ban by the central bank, the Reserve Bank of India (RBI). Since then, the crypto sector has been growing and attracting investments from abroad despite the global coronavirus pandemic and the nationwide lockdown. Meanwhile, Facebook’s Libra project has undergone a major change.

Source: Facebook Buys Stake in Reliance Jio — How the Deal Affects Cryptocurrency in India