Yesterday, May 24th 2019, The Financial Times reported that social media network, Facebook, had held talks with US based cryptocurrency exchanges, Gemini and Coinbase.
The talks are, apparently, in order to discuss the possibility of adding Facebook’s proposed GlobalCoin cryptocurrency to both of the high liquidity exchanges, in 2020.
According to the report, Facebook has employed a secretive unit, to investigate the creation of a cryptocurrency, for more than year.
The purpose of Facebook’s proposed cryptocurrency is similar to that of their previous failed venture into the web-based financial market, Facebook Credits.
It is thought that their GlobalCoin will be used as a payments mechanism throughout their ecosystem. Facebook are also intent on attempting to get their cryptocurrency accepted by retailers in the real world.
Facebook CEO, Mark Zuckerberg, recently went on record, at a developer conference, to state that he intends for his platform to make sending money as easy as “sending a photo”.
In an attempt to try and stabilise the value of their currency they are discussing the possibility of pegging it to multiple fiat currencies. Said currencies are rumoured to be the US Dollar, Euro and Japanese Yen.
According to the BBC, Facebook have already contacted the Bank of England about their prospective coin, although it is unclear exactly what was discussed in the meeting.
Just an Attempt to Reenter the Financial Market and Sell More Data?
As the company has been on the wrong side of press when discussing privacy, the use of a cryptographically secured coin may be an attempt at repairing some of the damages which have been felt after the Cambridge Analytica scandal.
However, privacy is a topic which the current crop of crypto/blockchain enthusiasts take extremely seriously and I highly doubt that any Bitcoin supporter will be looking to trust Facebook with their spending data.
When you consider that Facebook’s business model makes all users of their services ‘products’, and the data they share fair game for advertisers, it begins to feel as though their attempt to enter the financial market may be in pursuit of fine tuned targeted advertising.
The company is already able to share details regarding its users’ likes, dislikes, political persuasion, diet, friends circle, family, ethnicity and pretty much anything else. They don’t, however, have access to accurate spending records.
The proposed GlobalCoin would give Facebook, and its advertisers, access to in-depth information regarding every transaction made by users of the currency.
This would mean that advertisements will become even more targeted and scandals, such as the Cambridge Analytica one, would become even more of a threat and have a much higher success rate.
In turn, this would mean that users of Facebook’s services, whom also used GlobalCoin, would become even more susceptible to subliminal manipulation.
As the project rolls out we will know more about the technical aspects of the coin but, personally, I think the last company which should be trusted with the spending habits of the world is Facebook.
Love, peace and happiness.