Social media giant Facebook has stepped up their attempts to participate in the cryptocurrency world with a new discussion with the U.S Commodity and Futures Trading Commission (CFTC) over their proposed stablecoin initiative GlobalCoin.
The cryptocurrency, which is currently under Facebook’s Project Libra, will allow users to carry out seamless transactions and purchases across borders. Project Libra was secretly registered as Libra Networks, in Geneva, Switzerland on May 2, and is part of Facebook’s slow but sure march towards blockchain involvement. Another step was poaching some of the best talents in the industry, including two Coinbase veterans to work as compliance managers to further strengthen their effort.
If successful, the move will effectively bypass banks and their lengthy procedures as Facebook already has quite the followership, globally. Include sister applications, WhatsApp and Instagram in the picture and it is easy to imagine what a huge solution the GlobalCoin will be. Crypto enthusiasts are, however, waiting to see how or if Facebook will bypass the new anti-laundering directive, seeing as the GlobalCoin will not use any KYC measures in transactions.
The initiative, which has been in speculations since last year, has created a considerable buzz in the crypto news world. Earlier reports revealed Facebook’s plan to start trials with the Globalcoin this year, and they pushed a step forward by recruiting a specialist blockchain team to ensure that all goes well with the stablecoin. The team, which is headed by former PayPal President David Marcus, is made up of 20% more PayPal employees- a feat that is reminiscent of the former PayPal Mafia in the early 2000s.
In a report published by The Financial Times on Sunday, the discussions with Facebook were “a sign of how the world’s largest social media platform is laying the groundwork for an ambitious push into payments.” CTFC Chairman, Christopher Giancarlo, however, stated that the discussion is in its ‘early stages’ and the organization is still trying to understand the stablecoin and decide whether it could fall under their regulatory remit.
Giancarlo added that it is too soon to decide whether Facebook’s GlobalCoin could fall under CFTC’s remit but that if the cryptocurrency could be backed by the US Dollar, there would not be much of an issue left.
Facebook’s foray into cryptocurrency, although early, has already started receiving its share of criticism. Comments have started circulating about Facebook’s security breaches in past times, and there are doubts about the safety and consumer privacy online if they launch a stablecoin. Other worries are demographically-inclined, and people are wondering whether the initiative will float, seeing as the majority of the social media users are aging and may not buy into a Blockchain procedure at the expense of traditional methods.