Over the past few months, many people have been anticipating the fruition of Facebook’s blockchain project, nicknamed “Libra.” The whitepaper is set to drop this June 18, prompting wild predictions from several industry experts. As one of the biggest and most influential tech companies in the world, it’s interesting to see how Facebook will disrupt the crypto market and challenge the big names already in existence. Facebook’s cryptocurrency is called GlobalCoin, a stable coin that will be tied to several fiat currencies.
If you’ve already been in the crypto game for a while now, then you know that stablecoins have picked up steam over the past couple of years. These coins are pegged against traditional assets, with the US dollar being most popular. The idea is to tie the stablecoin to a traditional asset in order to limit the wild price swings that most cryptocurrencies suffer from. Since several fiat currencies will be tied to GlobalCoin, market experts expect that its price will be even more stable compared to other stablecoins already on the market.
Facebook, meanwhile, focuses on the main application of GlobalCoin, which is to help people send money across borders with minimal hassle and fees. A lot of other digital tokens have the same objective, but the volatile nature of their coins discourage people from transferring money because of price fluctuations and costly fees. Of course, many people still capitalize on this volatility through day trading. According to BTC Profit Test, they have seen a massive increase in their number of users mainly due to the huge price hikes in Bitcoin and other cryptocurrencies over the past few weeks.
Many crypto analysts believe that GlobalCoin’s impact will be mostly felt in developing countries, where Facebook enjoys a massive user base paired with a lack of an alternative for global payment methods. Regulatory uncertainty, however, may loom large over the new stablecoin. Only time will tell what kind of regulatory structure is ideal for Facebook’s new cryptocurrency.
It’s also worth noting that Facebook’s entry in the crypto world is unlike that of most crypto projects. The main reason is their enormous user base across their website, WhatsApp, and Messenger. They wouldn’t have any problems attracting new users since they can tap into their existing user base to instantly offer their latest blockchain-based network.
Current figures show that Facebook as 2.3 billion users, but only those who pass identity verification will be allowed to use GlobalCoin. This means that new numbers may show just how many real Facebook users there are. More importantly, this will change the way Facebook handles privacy, security, and data collection from its users.
Facebook is crypto’s new kid on the block, but it enjoys a significant advantage over existing tokens with the same end goal. By leveraging its widely popular website and mobile apps, they can instantly take the lead and even put an end to altcoins that have been around for years. Certainly, Facebook is a game-changer in crypto, and the coming weeks will determine how fast it can position itself as one of the market’s top names.
Jim Bevin is a passionate writer, guest blogger, and a social media enthusiast. The primary focus is writing high-quality articles after in-depth research and make sure it is a readers delight. Information is key and he abides by the rule of writing articles that will appeal to a broader audience.