Social networking giant Facebook may be negotiating with payment services companies such as Visa or Mastercard, to get support and funding for the stablecoin that is pegged with its legal money.
A report on Thursday from The Wall Street Journal (WSJ), citing “people familiar with the issue”, revealed that Facebook has been working for over a year to launch a stablecoin-based payment platform. . The effort called “Project Libra” aims to develop an electronic currency that allows billions of company users to send money to each other, as well as make purchases online.
Along with Visa and Mastercard, Facebook is also said to have talked with financial services company First Data Corp to mobilize a total of about $ 1 billion as collateral for the stablecoin .
According to WSJ, Facebook giant is also discussing with e-commerce companies for fundraising purposes and to get approval for the stablecoin. Facebook can also pay users in digital currency to see ads, as well as allowing advertisers to accept tokens in exchange for goods and then pay for more ads with it.
Much more is mentioned, but notably, Facebook is said to be targeting removal of scanning fees and card processing fees, usually around 2-3%, paid by sellers on each Transaction for banks and networks with payment processor. “If successful, the project will threaten the dominance of the card system for global payments,” according to WSJ.
Last December, reports showed that the social media giant could first focus on the Indian market to allow users to transfer money via electronic currency supported by fiat on WhatsApp, respectively. Use messaging that Facebook acquired in 2014.
Barclays analyst Ross Sandler recently estimated that Facebook’s electronic money project could bring anywhere from $ 3 billion to $ 19 billion in additional revenue by 2021.
The company established its own blockchain division in May 2018, with the aim of exploring technology. Since then, the company has expanded its blockchain team with new employees. It currently has about 22 open positions related to the blockchain, including legal experts, data engineers, marketing managers and many more.
Earlier this year, Facebook also hired employees of Chainspace, a start-up company that specialized in scaling up blockchain through a process called sharding.