Written by: Kriti Anand
The social networking company, Facebook, is set to launch its own cryptocurrency by 2020. It is to be called “Globalcoin”, and it will be released as early as 2020. The currency would allow users to make digital payments in a dozen countries.
Facebook has held talks with payments giants including Visa and Mastercard, looking for $1 billion in funding to support the project, according to reports.
According to the BBC, Mark Zuckerberg, the founder and chief executive of Facebook, last month met the governor of the Bank of England, Mark Carney, to discuss the plans. Zuckerberg had a discussion with US Treasury officials and is in talks with money transfer firms, including Western Union, to develop cheap, safe ways for people to send and receive money.
To stabilize the value of the digital currency and minimize volatility, Facebook is looking to peg GlobalCoin’s value to a basket of established currencies, including the US dollar, the euro and the Japanese yen.
Unlike other digital payment systems, GlobalCoin would allow consumers to make payments even if they have no bank accounts, report claims.
Facebook’s GlobalCoin may also allow money transfer via its encrypted mobile-messaging app, WhatsApp. At a Facebook developers’ conference last month, Mark Zuckerberg said: “I believe it should be as easy to send money to someone as it is to send a photo.”
It is being speculated that Facebook might face tough circumstances in India. India has always had a hostile approach towards digital currencies. On the other hand, India might allow its workers abroad to use WhatsApp for transactions.
This is the second time Facebook jumps into a crypto venture. It had launched Facebook Credits earlier, which shut down after two unsuccessful years. This time, however, the cryptocurrency could contribute as much as a whopping $19 billion in additional revenue to Facebook by 2021, as claimed by a Barclay internet analyst in March.