The new monetary system will compete against the likes of Bitcoin, and will be available to the company’s 2.6 billion users.
Cryptocurrency has been billed for many years as the currency of the future. This has yet to be proven true, though because while Bitcoin may have at one point enjoyed a surge in popularity, this cryptocurrency and other digital forms of cash are saddled with regulatory problems. This may soon all change when a new form of money is unveiled, controlled by one of the biggest tech companies in the world.
This week, Facebook took the wraps off its new cryptocurrency, a platform called Calibra. Calibra will serve as a digital monetary token system, which will allow the platform’s users to exchange money within their favourite apps. Those apps include Facebook, WhatsApp, and Instagram, whose user numbers come to a grand total of 2.6 billion people.
In order to avoid his new currency being written off as the likes of Bitcoin, Mark Zuckerberg has rounded up a number of big names to buy into the project. The names include eBay, Vodafone and Uber, who all stand to make additional revenue thanks to the guaranteed user base. In total, 28 companies serve as co-founders to Calibra, which will be built on its own dedicated blockchain.
The news of the cryptocurrency has excited businesses and investors. Shares in Facebook increased on Friday when the reports started to surface.
What distinguishes calibra from Bitcoin is that, thanks to a single company producing the tokens, it will serve as a ‘stable’ currency much like traditional currency such as the Dollar or Euro. Owing to a lack of regulation and volatility, Bitcoin’s value started out with a value of $600, skyrocketed to $19 000, and has now settled somewhere in the middle.
The project is not without controversy, as critics are fearful that the new cryptocurrency will provide Zuckerberg and Facebook with another means to control user information. There are also concerns about how stable the currency will be at first, as it may take the company an extended period of time to enforce the rules.