Facebook Libra Coin
Facebook has signed up more than a dozen companies including Visa Inc., Mastercard Inc., PayPal Holdings Inc. and Uber Technologies Inc. to back a new cryptocurrency called Libra Coin. Facebook to unveil it next week and launch next year. Facebook users will be able to send the digital coin, called Libra, to one another, and they will also be able to use it to make purchases both through Facebook and across the internet more broadly. In order to build support for the new coin project from its earliest stages.
Facebook's Libra Coin Supported
Since the beginning of the cryptocurrency craze about two years ago, enthusiasts have anticipated the entry of major social media companies like Facebook into the digital coin space. Facebook has reportedly been developing Libra for more than a year, and few details about the project have been available to the public. One thing that is known is that Libra will be pegged to a basket of government-issued currencies. This will be an effort to preemptively counter the extreme volatility which has plagued other digital coins.
The Libra Association
Facebook has already built in layers between itself and Libra. For instance, neither Facebook nor the member companies of the consortium, called the Libra Association, will control the coin directly. They may help to play a role in the development of the Libra payments network by acting as nodes to verify transactions. This is not a surprise that Facebook is careful to protect itself from potential regulatory issues related to its new cryptocurrency. Facebook Inc has been under intense pressure to deal with various privacy concerns. It has been announced, that they will release a detailed whitepaper on Libra later this month.
Facebook Libra Coin has a Future
This funding from the consortium members will back the coin, which will be pegged to a basket of currencies.
If this cryptocurrency is successful, Facebook could net $1 billion from the 100 companies it hopes to include in the project. Each of these nodes will also get a seat in the Libra Association as node operators, sending a representative to the consortium.
Facebook cryptocurrency rumors began circulating in May of 2018, when it had been reported the social media giant had begun looking into blockchain nearly a year prior. Facebook announced that David Marcus, vice president of its Messenger app and once-member of Coinbase’s board, would lead its blockchain efforts. Prior to Marcus’s appointment, Morgan Beller, a member of Facebook’s corporate development team, was the only employee studying blockchain.
According to reports, Facebook expanded the project and talk of a stablecoin increased with each step the company took into the new blockchain technology.
Libra Networks LLCwas registered in Geneva, Switzerland, earlier this year by Facebook Inc. This is their blockchain development section according to its register. BBC later reported that the company is looking towards a Q1 2020 launch of the coin, and has plans to begin testing it later this year before launching in a “dozen” countries.
Ahead of the launch of its whitepaper, rumored to surface later this month, the company has been posting blockchain job ads. Additional openings were posted this week.
Crypto In The News
Libra Coin may be used as a payment for messaging apps, among other things. In December, Bloomberg reported the coin would let users transfer money through its WhatsApp messaging service. The New York Times reported a few months later in February of this year that the project had moved to a place where Facebook was discussing selling it to consumers and was in talks with crypto exchanges.
If that’s true, there is a demand, according to a study from LendEDU, which found the coin could entice new users to crypto, and could be bolstered by use through Facebook’s Marketplace feature.
Though a whitepaper has yet to be published, concerns of regulation have already arisen. In the wake of the Wall Street Journal’s report that Facebook was recruiting investors to launch its cryptocurrency. U.S. Senators on the Banking Committee addressed an open letter to Facebook founder Mark Zuckerberg inquiring how exactly the coin would work, among other concerns. The Commodity Futures Trading Commission (CFTC) also told the Financial Times it was in early talks with Facebook. No formal application has yet been submitted. CFTC Commissioner Christopher Giancarlo said the body is still considering whether a Facebook cryptocurrency would fall under his agency’s jurisdiction.
Facebook has also brought on UK Standard Chartered lobbyist Ed Bowles as its London-based director of public policy to push the cryptocurrency, according to the Financial Times.
Below is a map of Facebook’s Libra Association, broken out by industry.