Facebook Inc. has enlisted more than a dozen businesses including Visa Inc, Mastercard Inc, PayPal Holdings Inc, and Uber Technologies Inc.
Each business will invest approximately $10 million in a consortium to govern the cryptocurrency, the WSJ revealed, quoting individuals familiar with the issue.
The cash will finance the coin’s development, which is attached to a basket of currencies issued by the government, the study said.
On demands for comments, Facebook, Mastercard, Paypal, Visa, and Uber did not react instantly.
Next week, after months of secrecy and speculation, Libra is due to be announced, with the product expected to come into effect next year. The Facebook coin, or GlobalCoin, is anticipated to be a stable coin linked to several main currencies and to be used in the Facebook-owned messaging app Whatsapp.
The social networking giant is planning to include bonuses for merchants adopting it with its cryptocurrency. In fact, the project’s employees would have the choice to pay in the cyber currency, Engadget reported.
Although a lot of data about the nature of the Facebook cryptocurrency has made its way out to the public, there is still a lot of mystery about how it will be run and ruled. Sources state that the cryptocurrency will not be controlled by either Facebook or individual consortium members. However, some participants may be able to run nodes on the network underlying the crypto payment network.
Facebook has already begun recruiting 2,38 billion customers on its platform for its cryptocurrency-based payments.
The social networking giant also set up a team within the business to investigate Blockchain technology and its prospective use for the platform, led by Messenger chief David Marcus.
Earlier in June, the firm launched a debate with the US Commodity and Futures Trading Commission (CFTC) on its crypto Stablecoin initiative. Many see Facebook’s entry into the cryptocurrency industry as a huge step forward for the emerging technology. It reflects one of the largest digital blockchain-based digital currency tech businesses in the world. This instantly opens the doors for billions of customers to cryptocurrencies.
It can explain the rush of these investors and the reports that fintech company Stripe, travel reservations website Booking.com and e-commerce website MercadoLibre have all signed on to the project.
There was a large push for companies to find uses for blockchain technology in 2018, and through to this year. It came off the back of 2017, a year complete of cryptocurrencies hype.
Cryptocurrency became a bit of a dirty word because of this hype and speculation as the major companies preferred rather mull-authorized blockchains and packable business blockchain solutions.
Facebook’s decision to adopt a digital currency based on blockchain will be a huge move towards legitimizing that other half of the blockchain ecosystem. There will undoubtedly be a considerable difference between the likes of Bitcoin and the coin of Facebook, but the hope will be that this experiment will prove that when more than 2 billion people use cryptocurrencies, a niche can be filled.