An independent foundation will manage Facebook's cryptocurrency network, which could launch as early as this month.
According to a report by The Information, Facebook will tech companies to join its "independent foundation" that will contribute capital and help govern the digital currency. Getting outside backers will effectively mean Facebook will be ceding control but would also mean more trust on its cryptocurrency -- especially at a time when the social network has faced scrutiny over its privacy policies and handling of data. The report quoted sources to say the launch could come as early as June. Facebook had earlier refused to comment on the reports of its rumored cryptocurrency plans.
Facebook is also planning to charge up to $10 million from companies to operate the nodes, which contain the computing power necessary to resolve complicated mathematical equations to validate transactions. The money could also help back the cryptocurrency, keeping it stable, something any user would be worried about after seeing the roller coaster ride taken by most cryptocurrencies in the last two years.
The Guardian said Facebook's users will be able to change traditional currency into digital coins, which could be used to buy things on the internet, in the shops and other outlets.
Through the GlobalCoin , Facebook wants to bring about a way of providing affordable and secure ways of making payments, regardless of the user having a bank account.
The BBC said that Facebook's founder, Mark Zuckerberg, met the Bank of England governor, Mark Carney, last month to discuss the opportunities and risks of launching the cryptocurrency. The British media house revealed that the social media giant was in talks with money transfer firms, such as Western Union, for cheaper and faster ways for people without a bank account to send and receive money.
Zuckerberg had said payments is an important area which needs to be made a lot easier: "Payments is one of the areas where we have an opportunity to make it a lot easier. I believe it should be as easy to send money to someone as it is to send a photo." Facebook has plans to add physical crypto ATMs to exchange local currencies for its tokens.
However, the GlobalCoin is not Facebook's first virtual currency. In 2011, it had come up with Facebook Credits and Facebook Gifts in 2012, which didn't take off as expected.
This article was first published in IBTimes US. Permission required for reproduction.