As Facebook accelerates its plans to launch its own cryptocurrency, the latest report from The Information states that the social media giant could likely launch its GlobalCoin digital currency by the end of June 2019.
Over the last few months, Facebook has been constructing its plans to introduce its crypto tokens. In this attempt, the company is talking with several online retailers, merchants, and even exchanges. The latest report shows that Facebook boss Mark Zuckerberg recently had a word with Gemini crypto exchange owners – The Winklevoss twins – to list the GlobalCoin.
Besides, the CFTC chairman also acknowledged that the social media behemoth is discussing the regulatory viabilities of its crypto token.
It looks like Zuckerberg is potentially seeing a huge opportunity lying ahead in the global payments market and doesn’t want to miss out on it. Facebook CEO Mark Zuckerberg also spoke about the opportunities in the payments market during the Facebook developer conference earlier this year.
Facebook Pushing Ahead Its Crypto Project
The latest report suggests that Facebook is planning to have crypto ATMs in place. Moreover, it is most likely to ask its employees to draw their paychecks in GlobalCoin thereby initiating its adoption. The major focus is to tap Facebook’s 2 billion user-base and give them a quick idea of how convenient it is to send payments using a cryptocurrency.
The report also notes that Facebook is planning to have third-party organizations to act as “nodes” to help the company manage its crypto network. Facebook is likely to charge $10M upfront for licenses to anyone willing to partner with them. Facebook will likely be running its entire cryptocurrency project under its newly established FinTech startup ‘Libra Networks’, in Geneva, Switzerland.
Over the last year, Facebook has taken a massive hit in its ability to provide “privacy” to its users. The idea to bring third-party organization to handle the payment nodes hints that Facebook is looking to convince the regulators that it won’t have absolute centralized control over the GlobalCoin. But no doubt the GlobalCoin will be most likely running on permissioned blockchain network with only the partners having access to it.
Banks are Wary of Facebook’s Crypto Plans
Although Facebook is coming up with its crypto plans some banks and regulators are wary of it. Rebecca Harding, the former chief economist at the British Bankers’ Association, notes that Facebook isn’t regulated the way banks are and neither the cryptocurrencies are regulated the way fiat currencies are.
Rebecca calls such crypto tokens to be “big regulatory headaches” when it comes to handling the KYC and Anti-money laundering rules. Of course, banks and their associates are likely to have a certain amount of bias to anything they see as a potential competitor. On the contrary, 14 global banks from Asia, Europe, and the U.S. announced the launch of their own Utility Settlement Coin (USC) earlier this week.
Speaking to the Financial Times, ING economist Teunis Brosens said:
“The sheer scale that a Facebook coin could achieve should give businesses, competition authorities and central banks some food for thought. Banks may find themselves disintermediated, with business suppliers increasingly bound to Facebook’s platform”.
Brosens further added:
“Launching virtual currencies on a modest scale has a negligible impact on monetary policy and financial stability.
But if a lot of transactions end up being handled by what is, in effect, a foreign currency, central banks might want to think again.”
According to a BBC report, Mark Zuckerberg has reportedly met Bank of England governor Mark Carney in April 2019 to outline his plans. Zuckerberg reportedly spoke about how his cryptocurrency can help reduce financial barriers while reducing the costs to customers.