Social media giant Facebook has made its first acquisition in the blockchain space by acquiring Chainspace, as per a Cheddar report.
Founded by researchers from the University College London, Chainspace is a small blockchain startup developing a decentralized smart contract platform. Its goal is to make the system scalable overcoming the present constraints of the blockchain technology.
According to Cheddar, the acquisition was made to poach the talent at the blockchain startup – a very common practice known as acqui-hire in the Silicon Valley. Four out of five researchers of Chainspace’s whitepaper are joining Facebook, claims the business media outlet.
A Facebook spokesperson confirmed that the latest hiring of the social media firm to strengthen its blockchain team and revealed that the acquisition would not transfer any technology of Chainspace to Facebook.
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“Like many other companies, Facebook is exploring ways to leverage the power of blockchain technology. This new small team is exploring many different applications. We don’t have anything further to share,” the spokesperson told Cheddar.
Like most of the blockchain firms, Chainspace also attracted the attention of many investors as its early backers include VCs like Leniscap and MW Partners. The firm is in the process of raising an initial round of funding of less than $4 million.
Facebook Ramping Up Its Blockchain Efforts
This is not a sudden move by Facebook to jump into the blockchain space as the company was already in the process of strengthening its blockchain team by hiring academics, product managers, engineers, and legal experts with experience in cryptocurrencies and blockchain technology.
Last year, Finance Magnates reported that Facebook is planning to develop a cryptocurrency for its widely used messaging platform Whatsapp.