While there have long been rumors of Facebook creating its own cryptocurrency (“Facebook Coin”), the project is now official, and it has a name: Project Libra. With this also comes some major news regarding their upcoming cryptocurrency.
It’s Officially a Stablecoin
We’ve long suspected that its cryptocurrency may be a stablecoin, just because it’s being used across their network and that helps make it easier for transacting across various apps. That does mean that it’s a centralized coin, but considering it’s being created by Facebook, that’s to be expected. The company is looking to bring in investments from major players – including some competitors – to help collateralize their coins. In this, they’re looking for “up to $1 billion.”
Creation of a Full Payment Network
Facebook is looking to create a full payment network, and they’re in talks with companies like Visa, Mastercard, First Data, and large e-commerce merchants to help support their launch. At the same time, one of their core desires is to help cut out transaction fees from credit cards across their site, so it’s unknown how well those talks will go at this point (considering Visa and Mastercard are direct competitors to what they’re going after). That said, they definitely have a lot of power and it’s entirely possible that they can work something out that benefits all of them.
Potential Tying to Facebook’s Ad Engine
Something they’re considering doing is tying their coin into their ad engine in some way, such as rewarding users for viewing ads and then purchasing a product. There are many similar networks already out there, but this would bring cryptocurrency rewards to a whole new level (like Jaguar’s plan to integrate IOTA into their vehicles). Not only does this help mainstream cryptocurrency, but it also helps their own platform by giving back rewards to those that make the purchases, which helps promote more attention to the ads, creating a profitable cycle that benefits the entire network. If done properly, it could essentially create a win-win-win situation between Facebook, its users, and its advertisers.
At this point, there’s no information as to when this coin will be released. Facebook is currently still trying to onboard ecommerce businesses, apps, etc. to help make it successful. Depending on just how everything comes together – and how easy it is to utilize – this could be a grand thing for cryptocurrency as a whole. That said, we are getting back to the centralized cryptocurrency arena, which has both its pros and cons. We at Crush The Street will keep you up to date on the latest information regarding these developments as they come, along with news of other cryptocurrencies and projects!