Facebook, the social media giant that has been lurching from crisis to crisis in recent years, is gearing up to unveil its bitcoin-beating new cryptocurrency GlobalCoin later this month, according to reports.
Ahead of the announcement, it’s been reported Facebook will cede control of the bitcoin rival to “an independent foundation” in an effort to both deflect accusations of centralization and soothe financial regulators.
Facebook has been working with financial and technology companies in recent months to build support for its planned rival to bitcoin, it was first reported by tech news outlet The Information, citing people briefed on Facebook’s plans.
The bitcoin-esque cryptocurrency, which has been linked to a Facebook project codenamed Libra, is expected to be aimed at developing countries where traditional currencies are less stable and will function as a “borderless currency,” according to The Information’s report.
Facebook’s bitcoin rival will likely be a so-called stablecoin, pegged to the U.S. dollar, and is expected to be integrated as a payment tool on Facebook’s popular messaging apps WhatsApp and Messenger, and photo-sharing app Instagram.
People will also be able to buy the digital token through physical ATM-like machines, while Facebook employees working on the project will be able to take their salary in the new currency, according to The Information.
Facebook is reportedly going to charge firms $10 million each to run a node for the GlobalCoin network and plans to allow all node operators to have a representation in the independent foundation.
The bitcoin price, which has recently rallied to year-to-date highs, failed to react strongly to the latest Facebook cryptocurrency news, although it has been desperately seeking direction over recent months as the traditional finance industry, global tech giants, and the world’s regulators mull how to proceed with bitcoin, blockchain, and cryptocurrencies.
The bitcoin price has regained ground following last year’s sell-off but is still far from its all-time highs. CoinDesk
Last month it was reported the bitcoin-inspired Facebook cryptocurrency would be rolled out for testing by the end of 2018, with plans to launch it in 2020 in up to a dozen countries around the world—potentially sending shockwaves throughout the burgeoning bitcoin and cryptocurrency sector.
Facebook’s embattled founder and chief executive Mark Zuckerberg has met with the Bank of England governor Mark Carney to discuss how a Facebook version of bitcoin might work and the risks and regulation involved, it was reported by the BBC.
Zuckerberg, who has taken a vastly different approach to bitcoin and cryptocurrencies to his fellow social media CEO, Twitter’s Jack Dorsey, appears to be more interested in supplanting bitcoin than developing it.
Facebook’s interest in bitcoin and cryptocurrencies has excited many in the burgeoning sector, with one venture capitalist saying the recent revelations have “lit a fire in the pants of every major [financial technology] and financial institution.”
It’s thought Facebook has been eyeing a move into broader financial services since hiring former PayPal president David Marcus in 2014, who also became head of the company’s blockchain division.
Author: Billy Bambrough