02 Jul 2019
It has been two weeks since Facebook has officially announced its plans to roll out the cryptocurrency named Libra somewhere in 2020, but the media keeps buzzing about whether this coin can actually be perceived as cryptocurrency or what not; the authorities are whetting their regulatory knives, preparing to chop Libra’s functional capabilities to pieces; the conspiracy theorists are making predictions about grave consequences for the global banking industry.
Amidst all that turmoil, the big crypto players have already begun lining up in front of Facebook’s office, obsequiously offering their services in exchange for a slice of a humongous financial pie.
Not surprisingly, Binance, the largest cryptocurrency exchange by adjusted volume and the third largest by reported volume, turned out to be one of the first who initiated the negotiation with the social media dominator regarding the possibility of listing the much sought-after stablecoin immediately following its official release.
During the visit to the FinTech Junction Conference, which took place last Thursday in Tel Aviv, Gin Chao, the Chief Strategy Officer at Binance, told the press that the exchange officials are currently engaged in preliminary negotiations with people from Facebook, concerning the possible listing of Libra sometime in the future.
He noted that the listing is unlikely to happen immediately after the official debut of this digital token because the corporation informed that they will be carrying out all related operations on a private chain; therefore, they will not be seeking external liquidity at the earliest juncture.
Nevertheless, Mr. Chao believes that Facebook will be looking for opportunities to enter the secondary market sooner rather than later since it is natural for the nascent currencies, even the hyped up ones like Libra, to seek the entry points to such markets for the purpose of increasing the target audience. That is exactly when Binance plans to come in bearing gifts.
Furthermore, the CSO hinted at the possibility of Binance becoming a part of the Facebook ecosystem by exercising the function of a permissioned node that validates transactions on the network. It is already known that the Facebook (or Libra) blockchain will run at least 100 nodes with some of them already been pre-booked by such globally renowned names as Uber, Visa, and eBay at the alleged price of $10 million per node.
Chao also noted that regardless of whether or not Libra gains global acceptance, the fact that one of the biggest companies in the world has embraced blockchain is an immensely positive thing for the entire industry because it proves the validity of the technology and the advantageousness of cryptocurrencies.
However, all these good things will become possible only if Facebook manages to play its cards right and avoid getting engaged in prolonged legal bickering with the US as well as the global regulators. At the same time, it appears that the governments are committed to taming the crypto industry by adopting tougher legislation. While the emergence of Libra may indeed be a positive thing, it could also be a tinderbox waiting to explode as the bureaucrats may take austerity measures against Facebook’s stablecoin for aiming a blow at the traditional financial system. In that case, the whole crypto realm would get in the line of fire.
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