Facebook has now gotten a lot of companies that will support it for the upcoming Libra cryptocurrency that it wants to announce this week. According to the reports reaching us from our sources, some of the companies that have agreed to support the online social media platform are top financial organizations such as Visa and Mastercard as well as internet pay portals such as PayPal, Uber, Stripe and Booking.com. each one of these companies have made the commitment to invest about $10 million to finance the development of the currency and they will in turn become part of the Libra Association – the independent consortium that will be in charge of the digital coin – meaning that Facebook will not be directly in control.
The choice that corporations such as Visa and Mastercard have made to become part of cryptocurrency is fascinating especially because of the general view of cryptocurrencies as a less costly option to every other payment network. Our sources however believe that the companies that want to support Facebook have the motive of supervising Facebook’s payment success and also gain from the currency when it becomes popular should it start with the 2.4 billion active users on Facebook per month.
On Facebook’s part however, the idea behind creating a body that governs itself is to ward off any suspicious thoughts that users and regulators may have especially those who are of the opinion that the social media network has too much power and the careless attitude it has when it comes to taking responsibility.
This cryptocurrency called Libra will be made public on the 18th of this month with the full release to be done next year. It is expected that the cryptocurrency will function like a “stabecoin” which means that it will be attached to a lot of currencies issued by various governments so as to reduce the feature of being unpredictable that most cryptocurrencies like Bitcoin have. Stability is the major focus because Facebook is looking to get users in developing countries mostly because their currencies are usually unpredictable.
Apart from giving users the ability to transfer cash through its messaging platforms such as WhatsApp and Messenger, Facebook hopes that the partnership it has formed will give users the ability to spend the currency online. Reports say that Facebook is also planning to develop ATM-like terminals where people can convert their money into Libra.
There are a lot of regulatory barriers that Facebook will have to overcome before it will be able to launch the currency and it will need to handle the issue of fraud and money laundering. Our sources say that Facebook met with the governor, Bank of England, Mark Carney to talk about the opportunites and risks that come with cryptocurrency, it also spoke with the US Treasury and firms that transfer money like the Western Union.