Facebook has been garnering a lot of news lately, with the introduction of Project Libra, which is speculated to become an e-commerce tool for the social media giant’s millions of users. However, it is speculated that like Bitcoin, Facebook’s coin could also be used for anti-social activities like money laundering, terror financing etc., with lawmakers and regulators alike, raising an eyebrow.
The new crypto will allow Facebook’s users to buy products from influencers on Instagram faster, than when compared to cash. Facebook will also make “money off a fee for every processed transaction.”
According to analysts from Merrill Lynch,
“Facebook could use cryptocurrency as a payment mechanism to remove friction across its various services. We see the launch as an important initiative for the company as it builds out a more private messaging ecosystem with e-commerce capabilities.”
The cryptocurrency will not require a bank account and the value of the coin will be backed by a basket of fiat currencies. However, some believe that there are high chances of Facebook’s sister concerns like WhatsApp and Instagram being used for money laundering activities.
Charlie Delingpole, CEO of Comply Advantage, an anti-money laundering consultancy, said,
“Facebook coin will do for money laundering what Facebook did for fake news — likely lead to an explosion in terrorist financing.”
According to Politico, an unnamed U.S Treasury official is of the view that digital assets are tools like cocaine and Rolls Royce, capable of being used by criminals and thus, a matter of U.S security concern.
Regulators, who have often opposed digital currencies since day one, while holding the view that it can be used for money laundering activities, say that, “It will be up to Facebook to prove them wrong.”
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