Facebook’s Libra stablecoin is quickly gaining steam. It apparently is going to enter testing this week on a testnet managed by the social media giant’s Libra Association. The digital currency will reportedly be hosted on the Libra Blockchain and backed by the Libra Reserve, but it has also reportedly found support outside of Facebook, as well. PayPal, Uber, Visa, Mastercard and several more companies are backing the coin, according to the Wall Street Journal.
It’s not too surprising that Visa would climb aboard. After taking a severe dislike to crypto over the past couple of years, it has started to soften its position. This comes, more than likely, from the realization that it is losing ground as crypto transactions are proven to be cheaper and more effective, and as more retailers drop the credit card and its payment processing.
In addition to the aforementioned entities backing the Libra, the Wall Street Journal also reports that Booking.com, MercadoLibre and Stripe are involved. However to what extent and how have not been revealed, but there are certain rumors.
The Libra is expected to be made available on Facebook’s various platforms—Facebook Messenger, WhatsApp and Instagram—but could be seen on other platforms, as well. It has been stated by an executive with MercadoLibre, in a conversation with Cointelegraph Brazil, that stablecoin will be rolled out on the e-commerce sales platforms as a form of payment. The executive, who remained anonymous, added that no more details would be provided.
The Libra is expected to be officially announced Tuesday (June 18). One of its primary goals, according to Facebook, is to help those who do not have access to traditional banking channels. The company has been working on ensuring it can meet regulators’ requirements in different jurisdictions and has stated, “Collaborating and innovating with the financial sector, including regulators and experts across a variety of industries, is the only way to ensure a sustainable, secure, and trusted framework underpins this new system.”
Emotions are mixed about the viability of a Facebook digital currency. It has been proven that the company is not very adept at handling its customers’ private information, which is a little unsettling, given the sensitivity regarding anything financial, including crypto. However, some analysts, such as Mark Mahaney and Zachary Schwartzman of RBC Capital Markets, assert that it is going to “unlock new engagement and revenue streams” for the company.
Others, such as crypto lobbyist Caitlin Long, believe that the Libra will help users migrate to crypto, but that they will ultimately look for other alternatives and not show much interest in Facebook’s offering.
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