Libra may appear in six months to a year.
Facebook already runs the daily communication of more than two billion people. Now the popular social network is going to get its own currency.
On Tuesday, Facebook announced an ambitious plan to create its own digital currency like Bitcoin, which will increase the demand for its services and increase advertising sales.
However, this initiative, which Facebook is launching together with partners such as PayPal, Uber, Spotify, Visa, and Mastercard, has the potential to complicate the situation of the social network, which is under Federal investigation for problems with the security of personal data of users. In addition, Facebook, along with other technological giants, threatens the antitrust investigation of Congress.
The creation of its own international currency, which could pose a threat to banks, national currencies, and users ‘personal data, is unlikely to weaken regulators’ interest in Facebook.
Digital currency under the name Libra is scheduled to launch within six months to a year. Facebook takes the lead in creating the currency and expects to receive up to $ 1 billion from existing and future partners.
The company emphasizes that Libra will be a convenient way to send money abroad without large fees, unlike systems such as Western Union. The system will also be able to attach to online trading a huge number of people who currently do not have Bank accounts or credit cards.
“In a few years, consumers around the world will have access to the global economy,” said David Marcus, a senior Facebook spokesperson, in an interview with the Associated Press.
The company can also use its own currency to increase sales through advertising posts in social networks.
The support of well-known corporations can make Libra the first digital currency to have mass appeal. Usually, cryptocurrencies are popular only among curious investors and fans of innovations.
Facebook claims that Libra will be different – partly due to the fact that the value of the currency will be tied to the “basket” of known currencies, such as the US dollar, the Euro, the Japanese yen, etc. Each purchase of Libra will be provided with a reserve Fund in real currency to stabilize its rate.
Facebook will not manage Libra directly. The company and its partners establish the non-profit association Libra Association, which will be based in Geneva and will be subject to Swiss financial regulators.
The company also created a new “daughter” – Calibra – which is responsible for the development of a “digital wallet” that allows the use of Libra. It is alleged that Calibra will not share user data with Facebook, except when necessary in a criminal case.
To have a wallet in Calibra, you don’t need to have a Facebook account. People will be able to send each other money transfers in Libra with the help of WhatsApp messenger and Messenger.
Many analysts believe that Facebook founder Mark Zuckerberg wants to create an American version of the Chinese service WeChat, which combines the functions of the social network, messenger, and payment system in one application.