Blockchain

Facebook Made a ‘Crypto Move’ in Switzerland Putting Rumors to Rest

The long going fuss about $140 billion Facebook, working on blockchain technology to setup its stablecoin has been stirring up for quite a while now. Recently, the doubts and guesses were put to rest when Facebook registered a new fintech firm, Libra Networks LLC, in Geneva, Switzerland. According to Geneva’s commercial register, that maintains a public database containing the main information on the legal entities, Libra was registered on 2 May 2019 with Facebook Global Holdings as a stakeholder.

A few weeks ago, the Wall Street Journal (WSJ) while following previous stories related to Facebook coin reported that under the shelter of Libra Networks LLC, the social media giant was planning to launch a cryptocurrency based payments system. Revealing the purpose of Libra Networks LLC, the purposed section of the register reads:

Provision of services in the fields of finance and technology, as well as the development and production of related software and infrastructure, particularly in connection with investment activities, the payment operation, the financing, identity management, data analysis, big data, blockchain and other technologies.

Furthermore, the status shows that the initial capital of CHF 20,000 will be required. The company will be dividing the total capital into 100 equal contributions, called quotas, where each contribution will be of CHF 200 worth. Apart from that, Libra had proposed to have three corporate bodies of the company that includes quotaholders meeting, managing officers and auditors.

The highest corporate body of the company, quotaholders’, capable of appointing and removing managing officers, will approve the annual reports of the company. On the other hand, managing officers will look after the tasks not catered by quotaholders. They will organize accounting, financial control and financial planning systems required for the company whereas the auditors appointed by quotaholders are prescribed to attend to the needs of the company as required by quotaholders.

READ ALSO: Crypto Ads Ban Removal: Facebook Paving Way for ‘Facebook Coin’

The very common sentiment in the space links the formation of Libra with Facebook’s secret plan of launching a stablecoin. In the past, there have been sufficient events that had led people to the current sentiment. Recently, Facebook hired two crypto experts from Coinbase, to its blockchain department. Mikheil Moucharrafie, who previously served as analyst and quality assurance tester at Coinbase, was appointed as the compliance officer for blockchain at Facebook whereas the second recruit, Jeff Cartwright, was given the role of policy and compliance manager.

Facebook has been adding blockchain experts to its team for a year now. In addition to the former Coinbase employees, Facebook opened five new positions in its blockchain department in the month of March. Apart from that, the former president of Paypal, David Marcus, is also affiliated with Facebook’s blockchain project. This thought prevailed when Marcus, who was acting as VP of messaging products, was later shifted to a division at Facebook that was exploring blockchain.

READ ALSO: 3 Ways in Which Blockchain Will Take Facebook Out of Its Miseries and Save Zuckerberg

Up till now, Facebook hasn’t released any official announcement regarding the launch of its stablecoin. However, the company’s acquired blockchain talent, Facebook’s search regarding VC funding of $1 billion points to social media giant’s move towards launching a cryptocurrency. In an attempt to raise funds, Facebook even went to several other payment networks such as MasterCard and Visa in the hope of getting a collaborative support.

Although unconfirmed by the company itself, the anticipation of Facebook launching a cryptocurrency has gained massive attention. It even got attraction at the Consensus 2019 where CEO Polychain Capital, Olaf Carlson-Wee, advised Facebook to build the stablecoin on an open, public blockchain. While explaining his point, Carlson-Wee clarified that Facebook should offer a platform like bitcoin’s, where the creators don’t have control of the platform they built. According to him, making infrastructure could result in success for Facebook. He elaborated:

I think given all the problems that Facebook has had with policing their platform and things like that, I think that the strategic move for Facebook would actually be to build public infrastructure. And that public infrastructure could be incorporated onto all the Facebook platforms, which of course are proprietary. But that public infrastructure, if they don’t try to own it, I think that’s where they will have the most success.

Besides, he also mentioned that by making a public platform, Facebook could avoid liability for controversy, like in today’s world, internet creators are not held responsible for everything said over internet.

Alongside people and enthusiasts in the space, the United States Senate is also skeptical about Facebook entering the crypto-verse. Following the skepticism, U.S Senate sent a letter to Mark Zuckerberg to inquire the details of Libra, Unfortunately, the letter could not unveil Zuckerberg’s plan entirely and the uncertainty continues to exits.

As Facebook has a user base of around 2 billion, launching a cryptocurrency can trigger mass adoption and disrupt the dynamics of the space. However, it must be noted that FB coin is a more of speculation than reality, until someone from the core team steps forward, we will be in the dark of the actual picture.

READ ALSO: U.S. Presidential Candidate Cannot Break Bitcoin, But Why She is After Facebook and Amazon

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Fatir Malik

Electrical engineer by profession, turned into blockchain developer. Fatir contributes regularly with his insights about latest developments in fintech sector. Contact the editor at editor.opinions@blockpublisher.com

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