Facebook to Launch its Own Currency
It has become clear that Facebook is set to release its own cryptocurrency which is internally and appropriately referred to as “GlobalCoin” – the name says a lot about the company’s intention of this project.
This news which was first reported by BBC comes after months of speculations with regards to Facebook’s crypto ambitions and the company’s “secret” blockchain project named Project Libra.
The BBC reported that the company is planning on “setting up a digital payments system in about a dozen countries by the first quarter of 2020”. It will begin testing its cryptocurrency which will run on blockchain technology by the end of this year.
The social media giant has yet to announce plans publicly, but according to BBC, it is expected to outline plans in more details very soon.
The company has reportedly sought input from the US Treasury in regards to operational and regulatory issues and is also in talks with Western Union, working with them to develop cheaper and easier ways for people to send and receive money.
Last month, Facebook’s founder Mark Zuckerberg met the Bank of England governor, Mr Carney to discuss the opportunities and risks involved in launching a cryptocurrency.
Users of this cryptocurrency will not be required to have a bank account, the social media platform aims to provide them with an affordable and secure ways of making payments.
The company is also considering tying the coin to Facebook’s core ads engine, rewarding users for viewing ads and then purchasing goods, similar to how loyalty points rewards work.
While Facebook is in a strategic position to make its plan work given the massive number of people who use Facebook, WhatsApp and/or Instagram. It is bound to face challenges. First is trust – will people trust Facebook enough to start changing their cash for digital coin? Second is regulations – will governments, central banks and regulations welcome this idea?
My only concern about what Facebook is trying to do is power. Just how powerful will the company become if GlobalCoin proves successful? Will that be a good thing?
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