What is the impact of Facebook’s new digital currency on crypto market?

  • by Ofeed Team
  • May 27, 2019, 1:3 AM
 12       6      

Facebook plans to launch a new digital currency by 2020, as the social media giant plans to create a digital currency that provides cheap and secure ways to pay without the need for a bank account.

According to the Financial Times, Facebook is expected to begin to disclose its plans in this summer, as Facebook founder, Marc Zuckerberg, has spoken with major cryptocurrency exchanges, where the first reports on the subject appeared in December.

After the announcement of the Facebook new digital currency report, the impact on the crypto market seemed to be slight, as the Bitcoin continued to struggle to past the $8,000 level.

However, the Bitcoin is meanwhile leading another rally, with a 6.46 percent soar to $8,555.08, according to CoinMarketCap.

Ethereum added 5.09 percent to $263.87 and Ripple surged 3.93 percent to $0.4005, yet EOS recorded the biggest increase among the top 10 digital currencies as it climbed 7.06 percent to $6.83.

Some analysts believe that institutional investors must step in the crypto market to help virtual currencies resume their bullish run.

GlobalCoin project details

The GlobalCoin project cooperates with banks and intermediaries that will allow currency traders to exchange between them and cash currencies, noting that a small group of founders are expected to launch an association based in Switzerland in the coming weeks.

It is believed that Facebook and its associates want to prevent sharp swings in the value of the coin by tying a basket of known currencies, including the US dollar, the euro, and the Japanese yen.

Facebook has asked for advice on labor issues and laws governing the release of currency from the U.S. Monetary Authority, while it is looking for cheaper ways to transfer currency to people who do not have bank accounts.

The US Senate committee of Banks wrote a letter to the United States Senator asking him how the digital coin that he planned to launch was working, and what protection measures the users were receiving.

Facebook also discussed with the U.S. Treasury the process of identity checks and how to reduce the risk of money laundering.

Ofeed Team

Ofeed’s team is comprised of highly distinguished analysts, with a wide experience in financial markets, having a unique analytical view of developments impacting global financial markets

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