Report: Facebook to Give Control of Its Cryptocurrency to Independent Foundation

 

 

 

 

Facebook reportedly plans to allow an independent foundation to manage governance of its new cryptocurrency , according to a report from The Information. That independent group will include financial and technology companies that Facebook has recruited as financial backers for its cryptocurrency project.

The decision to cede governance is apparently designed to placate regulators while encouraging greater trust in Facebook’s planned digital payment system. As TechCrunch reports:

Facebook is in talks to create an independent foundation to oversee its cryptocurrency, The Information reports. It’s asking companies to pay $10 million to operate a node that can validate transactions made with its cryptocurrency in exchange for a say in governance of the token.

 

It’s possible that node operators could benefit financially too. By introducing a level of decentralization to the governance of the project, Facebook may be able to avoid regulation related to it holding too much power over a global currency.

The Information’s report also suggests that Facebook may unveil its cryptocurrency and white paper later this month. Facebook has yet to provide details about its planned token, but sources have indicated that the company plans to integrate it as a payment option on its Messenger, WhatsApp, and Instagram apps.

The company is also expected to focus its efforts on developing nations with unstable currencies, to provide an alternative “borderless currency.” Other recent reports have also suggested that Facebook plans to peg its cryptocurrency to a basket of fiat currencies, to limit fluctuations in value.

Contrary to other recent reporting, the new cryptocurrency will apparently not be called GlobalCoin. Instead, TechCrunch reports that Facebook will probably use the name “Libra” for the new cryptocurrency, based on the project’s codename and the social media giant's recent registration in Switzerland of a financial company called Libra Networks.

Author: Ken Chase

Freelance writer whose interests include topics ranging from technology and finance to politics, fitness, and all things canine. Aspiring polymath, semi-professional skeptic, and passionate advocate for the judicious use of the Oxford comma.

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