India to become the testing ground for the Facebook’s Altcoin.
Whatsapp Pay Beta was launched in India in 2018. Now Facebook is planning to introduce its altcoin in India. The Indian Market consists of 200 million WhatsApp users. This consumer base will prove to be the most active experimental ground for Facebook to test its new venture. The analysts are expecting that this move will legitimize the usage of crypto currency in India.
Sidestepping RBI Regulations
It was in April, 2018 RBI had issued a ban on banking of
crypto currencies. The Facebook’s virtual coin has ruled out the use of any
banking services in the transfer. According to the experts, the ban will be a
major hindrance in the development of the blockchain currency market. The
matter is now contested in the Supreme Court of India by the Internet &
Mobile Association of India.
US Senate- Letter of Inquiry
The U.S. Senate Banking Committee has issued an open letter to Mark Zuckerberg, Founder, Chairman & CEO of Facebook to inquire about Project Libra and the actions taken by Facebook related to consumer privacy, data protection, legal and financial regulations. Following are few of those questions–
1. How would
this new cryptocurrency-based payment system work, and what outreach has there
been to financial regulators to ensure it meets all legal and regulatory
requirements?
2. What privacy and consumer protections would
users have under the new payment system?
3. What consumer financial information does
Facebook have that it has received from a financial company?
4. To the extent, Facebook has received consumer
financial information from a financial company, what does Facebook do with such
information and how does Facebook safeguard the information?
5. Does Facebook share or sell any consumer
information (or information derived from consumer information) with any
unaffiliated third parties?
Project Libra
Project Libra is the hyped project lead by Facebook to
launch virtual currency. The project is running under the leadership of David
Marcus, ex PayPal President. Marcus was leading WhatsApp Messenger when he
joined Facebook in 2014. Based on the reports earlier, Marcus has brought with
him other PayPal employees. There are almost fifty of former PayPal employees
working on the Facebook virtual coin. According to the sources, the company is
secretly developing a stablecoin which can be used by the WhatsApp users to transfer
money on peer to peer basis. This stablecoin is said to be pegged to US dollar.
The virtual currency is said to be characterized with the following features:
- Less like Starbucks (SBUX) and more like Bitcoin (BTC)
- Under control of the Centralized Authority (issue & development)
- Access will require Facebook Account
Effect on Market
According to twitterati, if Facebook launches the virtual coin, it will be the most used product in the blockchain market. Spencer Bogart from Blockchain Capital is hopeful that the Facebook’s launch will double the crypto currency market. Entry of Facebook in the cryptocoin market will be a stunningly important according to Mike Novogratz, the fund investor. The stablecoin will turn into the channel to accelerate the development of blockchain and will take it to the bottom most sections of the world economy.
Gloss