Facebook is courting companies and organizations to operate the 100 nodes planned for its cryptocurrency network. However, to manage each node, operators will have to pay a hefty fee of $10M.
Facebook has been accelerating the roll-out of its awaited cryptocurrency, likely to be called ‘GlobalCoin.’ To avert the eyes of skeptical regulators, the social media giant will be creating an ‘independent’ foundation responsible for monitoring the GlobalCoin Network. However, it has just come out that companies who want to participate will have to pay $10M per node. With 100 nodes planned, that’s $1B pocketed by Facebook just by setting up the network.
The high price is a tough sell, given that Facebook’s GlobalCoin may not be successful. It also makes a mockery of decentralization by selling it to the highest bidder. These nodes will likely be the hands of a few financial institutions, tech conglomerates, and other corporate giants, not much unlike our current banking system (with a little more Silicon Valley involvement, of course).
Facebook also says that it plans to roll out physical ATMs for its cryptocurrency, as well. Currently, the social networking company has set up a base of operations in Switzerland which focuses solely on payments and blockchain. It is alleged that GlobalCoin’s development is occurring there. The cryptocurrency will be tied to the US dollar and other major fiat currencies.
By lobbying financial institutions and focusing on payments, Facebook is trying to make its social media platform much like a digital bank. Your personal profile would thus be linked to your funds, identity, and location. The implementation of GlobalCoin will also inevitably require KYC compliance.
Altogether, this makes Facebook one step closer to making its profiles similar to ‘digital passports’ which will have to be authenticated. With the addition of GlobalCoin, Facebook is trying to position itself as a leading payment processor within e-commerce.
It’s a gamble which will, like it or not, probably work out in the end. Facebook is already used as a login for many third-party sites, and this number is only growing. Given that the U.S. State Department is now requiring Visa applications to submit their social media accounts, Facebook’s GlobalCoin will likely propel the platform into being the future’s digital ID.
Luckily, as dystopic as this all sounds, we can always choose to opt out and not participate.
Do you believe GlobalCoin will find buyers willing to pay $10M per node? Let us know your thoughts below.