What impact will Facebook's entry into cryptocurrency have on the cryptocurrency world?

Facebook is going to issue currency!

Can I go all in?

The regular army is coming, is Bitcoin doomed?

Facebook's entry may trigger a bull market!

As soon as the news of Facebook's "coin issuance" came out, the cryptocurrency circle was shaken, and investors had various questions one after another, because this melon is really too big. Domestic users may not know Facebook, because for some reasons, we cannot use Facebook. Simply put, Facebook is an overseas social software, including its WhatsApp social software. The number of users in the Facebook ecosystem is more than 2 billion, which is much larger than Tencent WeChat. Therefore, Facebook's entry into cryptocurrency is certainly worthy of attention in the cryptocurrency circle, but it is not what everyone thinks.

What’s the matter with Facebook’s “coin issuance”?

For friends in the traditional investment circle, Facebook's "coin issuance" is a bit unbelievable. Isn't "coin issuance" a scam? Why is Facebook doing this?

Although Facebook is a global social giant, its source of income is very single, relying almost solely on advertising revenue. In order to "save itself" , Facebook, based on the characteristics of a global social platform and cross-border payment as a rigid demand, has issued cryptocurrencies and further conducted financial-related businesses based on this network. After all, the ability of payment portals such as Alipay and WeChat to develop businesses in a very broad scenario has been proven.

Why doesn't Facebook just create a "Facebook Pay" similar to Alipay? You should know that Apple Pay already exists overseas. It is too difficult to directly compete with a very mature payment system, and there are more than one strong competitors. Therefore, digital currency is Facebook's special path to enter the financial and payment fields, and it can also give full play to Facebook's advantages.

As a result, Facebook started the "coin creation" campaign. It is currently scheduled to release a white paper on the 18th of this month. The project codename is Libra, and the official name of its digital currency is "GlobalCoin".

So is “GlobalCoin” worth investing in?

First of all, we must understand that "GlobalCoin" and the currency we speculate on are two different concepts. In essence, "GlobalCoin" is a stable currency, a stable currency anchored to the legal currencies of multiple countries. The purpose is to facilitate cross-border payments, facilitate the exchange of currencies of various countries, and achieve cross-border payments at a stable price . It does not have commodity attributes.

For example, Alipay balance and WeChat balance are also stablecoins or intermediate currencies. Facebook just turned these coins into digital currencies, which are the mapping of legal currencies on the blockchain. They have no hype value.

In addition, "GlobalCoin" is highly centralized. Facebook accepts third-party nodes, but they need to pay $10 million to become a node operator, which will be used as one of the sources of "GlobalCoin" reserves. Node operators are responsible for verifying "GlobalCoin" token transactions and obtaining network governance rights, and earning a certain amount of return interest.

Facebook has decentralized “GlobalCoin” to a certain extent, but compared with cryptocurrencies such as Bitcoin and Ethereum, it is still highly centralized. Everyone says EOS is centralized, but “GlobalCoin” is far more centralized than EOS.

Let me ask you, would you speculate on a highly centralized stablecoin?

So what actual impact does “GlobalCoin” have on the cryptocurrency world?

Since “GlobalCoin” is a stablecoin, what does it have to do with the cryptocurrency world? No, it has a lot to do with it.

1. Facebook has more than 2 billion users worldwide, and almost one in every two Internet users is a Facebook user. Once the public is more willing to accept digital currencies, more people will enter the encryption era, which will stimulate more people's interest in and investment in Bitcoin. After all, Bitcoin and other currencies are truly decentralized cryptocurrencies.

2. In order to provide a deposit channel for Bitcoin, if Facebook's stablecoin is connected to BTC and ETH transactions, it is equivalent to obtaining a deposit channel all over the world. The deposit channel is what people in the currency circle dream of, and Facebook has such a large number of users, and it carries a huge amount of funds.

3. Recognition of blockchain technology. Although "GlobalCoin" is a stablecoin, it is a real blockchain digital cryptocurrency. As the world's largest Internet social giant, Facebook's entry into cryptocurrency is the greatest affirmation of blockchain technology. Isn't this a great benefit to the currency circle?

Summarize

Facebook has Internet users on almost half of the world. The launch of Facebook's cryptocurrency will influence more people to enter the encryption era and will also allow more traditional technology and financial companies to enter the encryption field.

If the previous bull market brought Bitcoin into the mainstream vision, the task of the next bull market is to bring most of them into the market.

Author: Xiaoyan

Source: Blockwave