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Facebook is planning crypto currency service – what could possibly go wrong?

Written By: - Date published: 9:38 am, June 19th, 2019 - 15 comments
Categories: Economy, Financial markets, Social issues - Tags: ,

The corporation that has become renowned as the purveyor of fake news and the underminer of elections is planning to roll out a crypto currency service.

From the Guardian:

… [Facebook] is moving forward on a bold plan to combine remittances and the communication that makes remittance possible, by deploying its massive scale (2.4 billion users), vast collection of cash ($55.8bn in annual revenue), stable of lawyers and lobbyists, and teams of talented engineers to create the company’s own global electronic currency system.

The new currency, Libra, will be managed by an independent foundation via an encrypted blockchain ledger.But unlike bitcoin, nothing about Libra indicates a dream or desire to displace the role of states or state currencies in our lives. The plan is deeply embedded in the global financial and legal status quo.

If it succeeds, however, Libra could scrape away at the status of the US dollar as the universal “reserve” currency and if it takes even 5% of that global role it could affect the status and power of the American economy.

Only a company as global, wealthy, and politically powerful as Facebook could realistically hope to take over the global remittance market and it could do so by lowering fees to almost nothing. Such a move would not only help migrants and their families, it could wipe out all the competing services, including local banks and informal financial networks.

What could go wrong?  Handing over to a private corporation control of the world’s money supply?  The undermining of every central bank in existence?

I am sure everything will be fine …

15 comments on “Facebook is planning crypto currency service – what could possibly go wrong? ”

  1. Ad 1

    What indeed could go wrong

    +100

  2. James 2

    i think that the post heading says it all.

  3. Pat 3

    Facebook is virtual and importantly dosnt possess a military…..they may dream but it aint gonna happen, another bitcoin to milk the mugs

  4. gsays 4

    Sounds like an argument for the state to issue currency. Assuming we are uncomfortable with a private company influencing money supply.

    On the other hand… As the Christchurch murders showed us, the sheeple will not raise a whimper of negativity against FB because…inconvenience?…ingrained habit?

  5. tc 5

    Tactical play from the Zuck empire as the calls to break FB up grow with each latent discovery of their inability to police their own ecosystem.

  6. Stuart Munro. 6

    Makes sense on some level for Facebook to exploit its customer base – 2.38 billion apparently. If they do so however, they will challenge or need to find common cause with Google, who also have 2 billion plus clients. If they avoid fratricidal competition there is every reason they could make it work, the short term losers being credit card companies and the likes of Paypal. There is a bit of a credibility gap to overcome however – cryptocurrencies tend to make junk bonds look blue chip.

  7. Dukeofurl 7

    I can bet Facebooks 'vast collection of cash' wont go anywhere near a crypto currency.

    Just because it has $58 bill of revenue doesnt means its a 'pile of cash' : that sort of reporting is dumbing down to 10 yr olds.

  8. Dukeofurl 8

    Amazon and other e-tailers are already big in currency conversion. They encourage people to shop online in your local currency while buying goods offshore.

    But guess what, you are committing to currency conversion at the rate that favours Amazon.

    If you say buy in $US dollars the credit card company will do the conversion plus fees.

    A better choice is a local credit card which is preloaded with the foreign currency at better rates, then spend offshore in that currency . No conversions required

  9. SHG 9

    Only an idiot would consider using this.

    However Facebook is not short of idiots. This will be a huge success. For Facebook.

  10. infused 10

    its open source and on a public block chain. so there's that.

    be interesting to see how it will impact the other cryptos. it will be good I think. The crypto world needs some competition. Bitcoin had a chance and blew it.

    most people commeting here have no understand of the block chain or crypto in general.

  11. Sacha 11

    See also Apple, Google, Amazon, and WeChat already. Traditional banking industry will be lobbying lawmakers all over the world.

  12. PredictiveAnalysis 12

    Potential risks of a privately owned currency include various forms of corruption due to lack of oversight, self-interest, and profit opportunity via arbitrage and inside information,

    Ask a former money trader..

  13. A 13

    You do realise that the Federal Reserve is not part of the government? Yeah, the name fooled you didn't it. Suggest everyone do their own check into the history there.

    Our money has been gamed and it's time we woke the hell up.

  14. A 14

    The real benefit of Libra will be that it will bring crypto to the general public, their smartphones and everyday coffee type purchases. That's the point when things will get interesting but mostly because once they master one crypto, they can move to others and out of fiat.

  15. A 15

    Hey, just heard the :"house financial services committee" has sent facebook a C&D order. I guess Libra has just been permanently nixed.

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