Facebook’s Cryptocurrency, GlobalCoin, Expected in 2020
Facebook plans to set up a digital payment system by launching its own digital asset in 2020.
Rumors circulated around Facebook’s intention, suggesting that the newly created asset will be pegged to the US dollar. Thus, Facebook joins JP Morgan Chase as established businesses move in to create digital assets.
In general, any business can already resort to ready-made blockchain solutions. However, regulatory requirements still apply, and total anonymity with no limit to transactions will not be among the features of the new coin. Facebook is also reportedly in talks with Western Union, to find ways in which those without a bank account could send funds cheaper. The aim of the cryptocurrency is the same - to offer a technological solution for sending funds without a bank account.
The Libra project is also onboarding banks and retailers, to complete the process of building a complete digital asset ecosystem. Facebook has already discussed identity verification and consumer protection, as well as ways of handling any potential price volatility.
The incredible influence of Facebook may also mean more significant mainstream usage. Currently, an estimated 30 million users have been exposed to cryptocurrencies. Facebook, however, reaches 2.4 billion users in a single month. In the past, the social media has been hostile to cryptocurrency ads, especially with an aim to reduce consumer fraud.
The first launch of GlobalCoin will be for internal purposes, and there are no set deadlines for a launch to the public.
Until now, the only mainstream social media that has issued a digital asset is the Kik project. The KIN coin, initially working with the Ethereum blockchain, and later moving to a private chain derived from the Stellar (XLM) technology, proved to be problematic for the company. Reportedly, Kik spent significant time and funds to discuss the security status of the KIN token.
Other digital assets that have fought for mainstream acceptance include Ripple’s XRP and Stellar (XLM), where both projects work with traditional banking institutions.