A new cryptocurrency planned by Facebook is in line with efforts by the company to penetrate the digital payments market. The cryptocurrency, which is called Libra, has many critics expressing concerns regarding privacy issues.
Facebook has enlisted the help of 28 partner companies to help with the project. Some of the companies that have agreed to participate as part of the Libra Association include Pay Pal, Mastercard, and Uber. There no banks, as of yet, who have joined the association that is tasked with governance of the digital coin.
Calibra has also been created by Facebook to facilitate digital transactions. The subsidiary will provide consumers with wallets that will allow them to send, receive, and trade Libras. Calibra will also be connected with other platforms owned by Facebook like WhatsApp and Messenger.
The complete system is scheduled to be at work in the first half of 2020.
According to CNBC, executives for Facebook and the other companies involved with the project have a grand vision for Libra. The intent is not only to facilitate transactions between consumers and businesses across the globe that are already established. But the Libra Association also plans to provide individuals with no bank accounts access to financial services that were previously unavailable to them.
Facebook also believes Libra will make it possible for the company to earn more money through the apps they already operate.
United States Representative Maxine Walters, who is also the chairwoman for the House Financial Services Committee, made a request for executives from Facebook to provide testimony before Congress regarding the Libra project. She also suggested the company halt the development of the project until a full review can be conducted by regulators.
Waters characterized the Libra announcement as another ‘unchecked expansion’ by Facebook that allows it to further penetrate the lives of citizens.
There were also critical comments from regulators across the globe. The Finance Minister for France says he has requested a report by mid-July from the central bank heads of all G7 countries.
A representative for Facebook responded by saying the company will soon answer all requests for information.
Kevin Weil is a product manager for the Libra project. Weil says Facebook hopes to quiet the concerns of regulators by being public and transparent with all plans.
David Marcus, another executive working on the project, explains the name Libra derives from the Roman weight measurement and means freedom in French.
Shares of Facebook rose a tenth of a percent on Tuesday following the announcement.
