TL;DR: The Wall Street Journal, citing unnamed sources, believes Facebook Coin has all but moved forward. Something like a stablecoin, it will be pegged to “a basket of government-issued currencies,” with a dozen or so “financial firms and e-commerce companies [investing] around $10 million each in a consortium that will govern the digital coin,” which include the likes of Visa, Mastercard, PayPal, Uber, Stripe Inc., Booking.com and MercadoLibre Inc. CoinSpice recaps the project’s journey thus far.
Facebook Coin, a Consortium Governed by Visa, Mastercard, PayPal
Reports are fairly certain the social media giant will unveil its version of a cryptocurrency next week. The reason for journalistic hedging is due to exactly zero statements from the company formally on the matter. Non-disclosure agreements with employees and potential investors have relegated reporting to “sources familiar.” Here’s what we think we know.
Most are sure it will be a stablecoin, as the notorious swings of cryptocurrency markets have been a continual bugaboo for institutional finance getting more involved. The project is named Libra, and “revolves around a digital coin that its users could send to each other and use to make purchases both on Facebook and across the internet,” the Journal explained. Facebook has remained silent officially.
FACEBOOK COIN TIMELINE, an almost decade-long journey building momentum in recent months.
- Fall 2010: Facebook Credits announced, a kind of virtual currency to buy in-application products, gaming and otherwise — sold at retail stores.
- Spring 2011: Facebook Payments Inc created.
- Fall 2013: Facebook Credits disbanded, removed.
- Mid February 2019: Facebook posts job listings for blockchain-related tasks.
- Late February 2019: New York Times reveals through a dozen unnamed sources the company has 50 engineers working on its own version of a digital coin.
- Early March 2019: Employees on their crypto-related project are working separate from the formal company, and appear to be supervised by a former PayPal executive.
- Early March 2019: Zuckerberg posts about the importance of encryption, which many believe was a signal aimed at Telegram users (a company also rumored to be advancing its own token/coin in the near future).
- Mid March 2019: Respected finance crediting/rating agency believes Facebook Coin could have an $18 billion valuation.
- Late March 2019: The company looks to hire 20 more people to its blockchain team.
- Early April 2019: Nathaniel Popper believes venture capitalist firms are being approached by Facebook for their coin project, with asks as high as $1 billion.
- Early April 2019: Tim Draper confirms Facebook Coin interest, but the reason for a lack of information has to do with non-disclosure agreements (NDAs) foisted on anyone who took a meeting on the subject.
- Early May 2019: Leading legacy finance news outlet, The Wall Street Journal, picks up the story, advancing through, again, unnamed sources how the project might be something of a stablecoin offering … which analysts in the ecosystem have been stressing this year would be a breakout sector.
- Early May 2019: Wired reports the company will embed whatever digital coin into something like a loyalty points arrangement.
- Early May 2019: The company suddenly shifts its cryptocurrency advertisement ban, which to many observers signaled a clear path for their own coin.
- Late May 2019: BBC insists the project is called GlobalCoin, and will be rolled out in 2020, a stablecoin within its subsidiarity platforms such as Instagram and WhatsApp. It’s unclear if this in addition to earlier reported coin rumors.
- Early June 2019: Facebook employees will be allowed to take salary in the coin, CNBC passes along, which is set for an 18 June 2019 release.
- Early June 2019: The coin’s white paper is rumored by yet another media outlet for release on June 18th, going live in 2020 as a stablecoin named, for now, Libra.
Bitcoin (BTC) as a project has failed to gain mass adoption many hoped for it by now, a full decade-on. Some blame high fees, slow transaction times, price volatility, toxicity as reasons for the snail’s pace. Others simply believe the regulatory hurdles and lack of infrastructure doom BTC altogether. And press accounts about linking cryptocurrency to money laundering and terrorism haven’t helped its public relations image.
“Facebook won’t directly control the coin,” the Journal elaborated, “nor will the individual members of the consortium known as the Libra Association. Some of the members could serve as ‘nodes’ along the system that verifies transactions and maintains records of them, creating a brand-new payments network, according to people familiar with the setup.”
DISCLOSURE: The author holds cryptocurrency as part of his financial portfolio, including BCH.
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