RBC Analysts say that the GlobalCoin by Facebook is one of the biggest and most important initiatives taken by the company. The cryptocurrency will one day be called a historic initiative. Mark Mahaney and Zachary Schwartzman of RBC Capital Markets said in a note on Thursday:
We believe this may prove to be one of the most important initiatives in the history of the company to unlock new engagement and revenue streams
Facebook launched white paper on 18th June 2019 and explained the GlobalCoin project that it has been developing for over a year now. The previous details about the coin have mostly been speculations and leaks. The white paper explain the working of Project Libra, Fakebook’s internal name for the project.
It has been rumored that Facebook employees have been offered to take their pay in the form of the new currency, further strengthening the reports. RBC has plans to offer a complete rundown of the white paper after it is released by Facebook. Explaining their plan Mahaney and Schwartzman said the rundown aims to:
To help investors analyze the underlying crypto-economics of the token.
The Facebook coin is said to be a stablecoin backed by a consortium of global currencies; the backing of different currencies would enable users to make overseas trades. However, Caitlin Long’s Forbes article makes a prediction that the rise of Facebook’s cryptocurrency will make bitcoin popular again. She wrote:
“More people will turn to bitcoin for one simple reason—bitcoin is scarce, while Facebook’s cryptocurrency is not. People will migrate over time to the most honest ledger for storing their hard-earned wealth—and that’s not fiat currencies or derivatives thereof, including Facebook’s cryptocurrency.”
Currently, RBC says that Facebook’s stock that is now trading at $177 a share will jump 35% this year to $250, outperforming the market’s expectations.
The coin has been in development for more than six months with Facebook spending 2 years overall on the project. It is believed that a team of more than 100 people is working on the project. Christian Catalini, an MIT professor with research in digital currencies, is working with Facebook on their stablecoin project, according to a report. Catalini, who received his Ph.D. in Strategic Management from the University of Toronto, is one of the most prominent crypto economists in the world.
The company has put David Marcus, ex-president of PayPal, as the head of ‘Project Libra’. Marcus is a die hard crypto enthusiast and an early investor in bitcoin. He also served on the board of the biggest crypto exchange company, Coinbase, but resigned in August 2018 when Facebook started developing its blockchain system. A CNBC report quoted Ryan Gilbert, a partner at Propel Venture Partner, as saying:
Under David’s leadership, Facebook is poised to be one of the leading players in crypto and an active acquirer. Who knows, one day an acquisition of Coinbase could be in the cards.