FACEBOOK is finally ready to reveal one of its most secretive projects: a new Bitcoin rival.
That’s according to insiders who say the company will detail its plans to create a “Facebook coin” on June 18 – but experts warn it could be used to spy on purchases.
It’s long been rumoured that Facebook has been working on a cryptocurrency that users can swap using apps.
And Mark Zuckerberg has already expressed interest in developing Bitcoin tech.
Now TechCrunch reports that Facebook will release a whitepaper explaining the project later this month.
It cites a source who says multiple investors have already been briefed on the project.
Facebook is supposedly going to call the currency “Libra”, according to The Information.
It will reportedly be transferrable (with zero fees) between Facebook apps like Messenger and WhatsApp.
And Facebook is said to be working with retailers to accept Libra as a form of payment.
Libra is expected to be tied to lots of different currencies (rather than just the US dollar) to keep its price stable.
It’s also looking likely that there’ll be physical devices that can be used at cash machines, so regular money can be exchanged for Libra.
Facebook has registered a company for financial services in Switzerland called Libra Networks, as reported by Reuters.
And the project is being overseen by David Marcus, VP of Facebook Messenger and former PayPal president.
Unsurprisingly, some experts think that Facebook could use the Libra coin to snoop on purchases.
By mapping what Facebook users are spending money on, they could attract advertisers who want to target ads more effectively.
“A better understanding of who buys what or which brands or popular could aid Facebook in ad measurement, ranking, and targeting to amplify its core business,” said Josh Constine, tech expert and boss of gadget site TechCrunch.
Importantly, cryptocurrency transactions are typically recorded in public ledgers, so anyone can see which accounts money is being transferred between.
What is Bitcoin?
Bitcoin got you baffled? Here’s what you really need to know
- Bitcoin is a virtual currency
- It’s traded between people without the help of a bank
- Every transaction is recorded in a public ledger, or ‘blockchain’
- Bitcoin is created by mining
- Mining involves solving difficult maths problems using computer processors
- Bitcoin can be traded anonymously, which makes it a popular way of funding illegal activities
- A single Bitcoin is worth just uover £6,200 today, but the value fluctuates wildly
- Bitcoin is one of many different cryptocurrencies, but by far the most popular
Back in January 2018, Facebook chief Mark Zuckerberg first hinted that the service would be getting its own version of Bitcoin very soon.
The Facebook founder teased his interest in so-called cryptocurrencies in a blog post that outlined his plans for the year.
Zuckerberg explains that users are concerned that big tech companies and spying governments are crawling their Facebook habits.
He believes this could turn away users, and admits that Facebook is making “too many errors” when it comes to user trust.
One way he believes Facebook could change this is by adopting what he calls “important counter-trends…like encryption or cryptocurrency”.
Zuckerberg says these technologies “take power from centralised systems and put it back into people’s hands”.
He adds: “I’m interested to go deeper and study the positive and negative aspects of these technologies, and how best to use them in our service.
And like everything Facebook does, the move to Bitcoin sparked concern among experts.
“There is no doubt that Facebook is treading into new and risky territory with this move,” said Steve Giguere, global solution architect at software and microchip firm Synopsys, speaking to The Sun.
“The risks associated with this concept will be surrounding the identity of the user’s ‘wallet’, which associates a certain value of crypto to a person.
“Some of the major breaches around crypto have been hacks into wallet applications or even into mobile devices which can gain access and trigger unwanted transactions to anonymous wallets which can be immediately cashed out or laundered through other crypto exchanges.
“As the fruits of this research are undoubtedly years away still, Facebook will have to clean up its act with regards to its handling of personal data before we can expect the common public to put our money where our data is.”
We’ve asked Facebook for comment and will update this story with any response.
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Bitcoin recently saw a huge surge of £1,800 in a single week, and experts couldn’t agree on why.
But fears of a major crash were revealed by JP Morgan, who warned that the currency is now “overvalued”.
In other Bitcoin news, it recently emerged that the world’s first “Bitcoin city” where cash is banned hopes to attract 3million “crypto-tourists” a year.
Would you trust a Facebook currency? Let us know in the comments!