Facebook, on May 2, registered Libra Networks, a firm specializing in developing blockchain technology, in Geneva. This is their first foray into developing in-house blockchain technology and could have adverse effects on the crypto-market, if speculations are to be believed.
Recently, the United States Senate sent out an open letter to Mark Zuckerberg, asking details about their cryptocurrency project named “Libra”. This came out after they read about it in an article by the Wall Street Journal.
The project is likely to be released in the second quarter of 2019 and the development team was already set up last year. It is looking at introducing a coin which users can spend on its website or any other. According to the report by Wall Street, Facebook is also looking at backing its crypto-coin with the dollar reserve. This is done to make it less volatile from Bitcoin and other cryptocurrencies.
Libra will be looking at investing, payments, financing, blockchain and other technologies to work on via their newly established firm. The social media giant is in talks with all major payment networks like Visa, Master Card and more and is looking to raise around $1 billion for the crypto-project. The crypto research team is expected to be headed by David Marcus, the ex-PayPal president.
However, the crypto-ecosystem is skeptical of Facebook entering the crypto-verse. One of the reasons for this is their past controversies surrounding the sale of user data to third parties. Following the issue, people now allegedly maintain a notion that Facebook could repeat history and sell their private data to any third party and this could spell disaster for crypto-users.
India is one of the biggest markets for Facebook as India has the highest number of WhatsApp users across all markets. While looking at the crypto-market in India, Facebook may have to make large changes in its policies owing to the possibility of a blanket ban on cryptocurrencies in India.
Author: Sarvesh Kumar