Following the latest media reports, about Facebook Global Coin launch in June 2019, AtoZ Markets decided to find out how the Facebook crypto might impact other digital coins, including Bitcoin (BTC) and Ripple (XPR).
June 17, 2019, | AtoZ Markets – The new Facebook coin will enable users to process transactions via the social media channel. In addition, the Facebook Global Coin will be offered to the company’s employees who want to be paid in the form of the cryptocurrency.
The Facebook coin gets a huge support
Different media resources announced that the social media giant founded Libra Networks, which would focus on the blockchain, payments, data analytics, and investing. Back then some sources said that Facebook intends to attract external funding in the amount of $ 1 billion in donations to support its cryptocurrency.
According to the latest reports, Facebook’s yet-to-launch cryptocurrency has attracted at least three major payments companies as backers, like Mastercard, VISA and PayPal, including Uber, Coinbase, and Andreessen Horowitz & Union Square Ventures. As the anonymous sources reported, each will invest approximately $10 million into a foundation that will govern the coin.
How Facebook Global Coin launch would affect Bitcoin and Ripple?
The crypto community has split into two camps since the first Facebook GlobalCoin announcement:
- Some believe, that after GlobalCoin launch, Bitcoin will lose the dominance in the crypto market.
- Others think the Facebook Libra Coin would be a blessing for all cryptocurrencies in the blockchain space.
The finance companies that have expressed their willingness to invest in Facebook Libra coin caused a storm of indignation. Crypto enthusiasts perceived the collaboration between the social networking giant as a signal of a growing threat to such viable coins as Bitcoin and Ripple’s XRP.
Crypto enthusiast Kieran Kelly believes that Facebook might simplify the crypto adoption. Kelly proclaimed that Libra Coin would help XRP and BTC to be more accepted.
To support Kieran Kelly words, it is worth to mention, not very recent JP Morgan coin launch. Back then, one of the largest banking institutions in the U.S. managed to raise the same hype when introduced its own crypto.
Then the crypto community believed, that the US-backed JP Morgan Coin will drag Bitcoin and Ripple’s XRP to the mire. However, the JP Morgan stablecoin was later viewed as a way to bring more adoption for the cryptocurrency.
Expert opinion: Libra Project’s impact on cryptocurrencies
“As per the data, Facebook has 2.5 billion registered accounts and more than 2.38 billion monthly active users so, they already have a huge audience for mass adaption for Facebook’s cryptocurrency. But, the important aspect would be the concept and technology which they are using to create the coin. However, decentralization plays a very important role when it comes to cryptocurrencies, which FB coin is not! Thus, I believe that it might not have any hard impact on cryptocurrencies like Bitcoin, Litecoin, ZCash, and Monero. Also, it will not impact Ripple in any case as XRPs main focus is as a bridging asset and on-demand liquidity for banks and remittance companies.” – AtoZ Markets’ Senior Market Analyst Aman Sonewane
Author of Consensusland: “Facebook Libra will not impact BTC price”
“The Devils in the details. I don’t think it makes a difference for Ripple. Because no bank is going to send a $15 million transfer using WhatsApp. XRP token price is purely speculative. It’s longer-term prospects are deeply tied to Ripple’s success so probably not going to be affected by FB crypto.
Looking more broadly, I can see Facebook adding to the legitimacy of cryptocurrency as a technology. But I’m not sure people who use Facebook are going to suddenly FOMO into bitcoin. I’m not even sure Facebook is going to market its cryptocurrency as “cryptocurrency”. I’ve done communication strategy with fortune 500 executives. When I worked government relations, and I suspect Facebook’s message is going to be something along the lines of “bitcoin is unregulated and not secure. Our token simply uses the same technology but in a safe, compliant, private way. We don’t do cryptocurrency. We use blockchain to create a unique digital asset that users own and control.” (Not that I have any insight about how Facebook plans to position this new service it’s offering).
I don’t think it hurts to have Facebook with a cryptocurrency. I just don’t think it’s going to have that much impact on cryptocurrency prices. Or increase the movement of money into Bitcoin or XRP. Awareness doesn’t mean people are going to start buying bitcoin. In the United States surveys show awareness between 74 and 95%, depending on the survey. And still, the vast majority of people are not buying bitcoin.” – Author of “Consensusland: A Cryptocurrency Utopia” – Mark Helfman
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