A Wyoming Blockchain regulator and so-called “crypto-mom” Caitlin Long has made 6 predictions on the upcoming Facebook’s cryptocurrency dubbed GlobalCoin. She predicts that Facebook could potentially pay interest to its users.
“Facebook will pay interest to users of its cryptocurrency, which will eventually lead to populist calls to repeal subsidies at the heart of the US banking system,” she writes on Twitter.
Backed Assets could probably be stored in the Federal Reserve
It is a well-known fact that Facebook’s anticipated cryptocurrency will be a stablecoin. That means that it will be backed by a large sum of fiat currency. This money Facebook will probably store somewhere where it could generate interest. That is why Caitlin speculates that the place where to hold that amount of money could be the Federal Reserve.
Caitlin Long says that up to date, stablecoin issuers have generally pocketed the float on assets backing the coins. However, her next prediction is that Facebook won’t be able to pocket these big profits without sharing them with their users. Simply because of the fact that Facebook’s cryptocurrency will be the largest and most public crypto entity one has ever seen in this market.
“If Facebook doesn’t share these interest spoils with users, a chorus of critics will loudly publicize how much money Facebook and its partners are pocketing,” says Long.
According to Federal Reserve’s interest on excess rate, the Federal Reserve pays 2.35 percent.
Long went on and predicted other things related to the Facebook’s cryptocurrency. She believes that Facebook’s GlobalCoin will face all kinds of regulatory uncertainty. In addition to this, she commented that she knows a perfect regulatory structure for this. Hinting her Wyoming Blockchain Task Force and the state of Wyoming in general.
Next, she believes that the new cryptocurrency will reveal how much of the recently widely discussed Facebook 2.3 billion users are real. This is because in order to use the currency users will have to pass KYC procedures.
She goes on saying that Facebook will become a “huge data honeypot for governments globally with all the privacy and tax reporting implications such as data honeypot entails,” she writes. All-in-all, she asks quite a rhetorical question. In the case of Facebook being struck with government regulations – “would it fight or fold?”
GlobalCoin Could Drive Bitcoin Adoption
The last thing that Caitlin predicts is that the development of GlobalCoin could potentially boost the adoption of Bitcoin. She says that by “educating consumers about the benefits of crypto and improving the user experience, Facebook will pull more users into Bitcoin, whether it intends to or not.” While Bitcoin is the king of cryptocurrencies, it is still the only ledger in the cryptocurrency field which is considered the most honest of all. People will recognize this as they embark with the new cryptocurrency. If comparing Bitcoin to Facebook’s GlobalCoin, the main reason why people might turn to Bitcoin is that it’s more scarce while Facebook’s cryptocurrency is not.
“Facebook will greatly accelerate the pace of teaching people about cryptocurrencies. And when this happens, more people will turn to bitcoin for one simple reason—bitcoin is scarce, while Facebook’s cryptocurrency is not,” says Long.