Technology 2 min read

Facebook To Announce Its Libra Cryptocurrency This Week

After securing the support of major international financial institutions in developing its crypto-based payment system, Facebook is now about to launch its own crypto-coin - Libra cryptocurrency.

Image Credit: Pixabay

Image Credit: Pixabay

Facebook is trying to build a crypto-based payment around its extensive network, and it’s calling the crypto-coin Libra cryptocurrency.

According to reports on the Wall Street Journal, Facebook is set to announce its upcoming cryptocurrency this week.

Last month, the social media giant reportedly registered a new company, Libra Network, in Geneva. With this registration, Facebook inadvertently announced its first foray into blockchain technology.

Before then, it had secured the backing of different companies, including major financial institution. These include Visa, MasterCard, PayPal, Stripe, Uber, and booking.com.

The companies had to invest $10 million each for the development of the cryptocurrency. In return, they’ll be part of an independent consortium that’ll govern the digital currency, Libra Association.

Now, here’s the big puzzle.

Cryptocurrencies are generally considered a cheaper alternative to payment networks such as MasterCard and Visa. So, why would these major financial firms invest in a potential competitor?

Well, Facebook has about 2.4 billion monthly active users. Aside from benefiting from the potential success of the cryptocurrency, the companies can monitor the social media giant’s payment ambitions.

The independent body, Libra Association, exists to protect the regulator and users who have grown cautious of the power Facebook wields.

Libra Cryptocurrency and Possible Regulatory Hurdles

Tech Crunch reported that Facebook intends to unveil the new Libra cryptocurrency on June 18th, with its full release stated for 2020.

The cryptocurrency will function as a “Stablecoin.” That means, it’ll be pegged to an exchange-traded commodity or government-issued currency to limit volatility.

Aside from allowing users to send money across all its platform, Facebook hopes to encourage eCommerce firms to spend the currency online through a partnership. Also, the social media company is reportedly developing physical terminals to enable the conversion of fiat currency into Libra.

But before it can launch its cryptocurrency, Facebook must first overcome several regulatory hurdles.

One of the most significant concerns includes fraud and money laundering issues. This may be the primary determinant of the cryptocurrency’s success in key markets like India.

Facebook has reportedly met with the US Treasury and Western Union, including the Bank of England Governor, Mark Carney to discuss the opportunities and risks that come with Libra.

Read More: Cyber Immortality: Dead Facebook Users Will Soon Outnumber the Living

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Sumbo Bello

Sumbo Bello is a creative writer who enjoys creating data-driven content for news sites. In his spare time, he plays basketball and listens to Coldplay.

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