By CCN: Mark Zuckerberg has been collaborating with his old rivals, the Winklevoss twins, to launch a digital currency that can be used across Facebook, WhatsApp, Instagram and beyond, according to a report in the Financial Times. Facebook's cryptocurrency, reportedly dubbed GlobalCoin, is expected to…
By CCN: Mark Zuckerberg has been collaborating with his old rivals, the Winklevoss twins, to launch a digital currency that can be used across Facebook, WhatsApp, Instagram and beyond, according to a report in the Financial Times. Facebook’s cryptocurrency, reportedly dubbed GlobalCoin, is expected to make its debut next year.
The FT reports that Facebook is talking to crypto exchanges including Gemini, which was founded by Tyler and Cameron Winklevoss, in addition to Coinbase. The concept is that users of Facebook’s payment crypto would have the option to potentially hold their coins on a trading platform or convert it for another coin or cash.
Aaron Sorkin’s blockbuster film “The Social Network” made the Winklevii famous. The movie tells the story of young Mark Zuckerberg jumping ship from the Winklevoss’ ConnectU network to start his own social media platform. The twins sued the Facebook founder in 2004 for stealing their idea. The judge awarded a $65 million settlement.
Loathe to miss the next big disruption in technology, Cameron and Tyler Winklevoss plowed $11 million of their Facebook settlement into bitcoin in 2013 when 1 BTC was selling for $120. They claim to own around 1% of all bitcoin in existence. Their holdings reportedly made them the first known bitcoin billionaires during the bull run of 2017.
It appears Mark Zuckerberg and the Winklevoss twins have patched things up since 2004. There might be a lot in it for all three tech entrepreneurs. After launching a New York-based bitcoin exchange Gemini Trust in 2015 and battling with the SEC to introduce a bitcoin ETF, the Winklevoss’ have both regulatory and technical experience to offer.
At this point one might be forgiven for thinking Mark Zuckerberg’s business strategy is to copy the Winklevosses. He cribs their business ideas to engineer them and market them better.
But it might not pan out the same as Facebook did, despite the network effect of his popular website and access to vast amounts of capital this time around.
Neither Cameron nor Tyler Winklevoss invented crypto; Satoshi Nakamoto did. And Facebook’s GlobalCoin is likely to be in many salient ways the exact opposite of bitcoin’s revolutionary features.
Facebook’s global currency aspirations might be dogged by some brand issues.
Last year the world learned Facebook sold the personal data of 87 million users to Cambridge Analytica. This year we learned Facebook was storing hundreds of millions of user passwords in plaintext files accessible by thousands of Facebook employees, a practice that started in 2012. Who would trust their money with a company that has been so careless with the photos they took of their breakfast?
Facebook has also censored content on its social media platforms. One reason the company did so is that they can. Facebook centrally controls its users’ accounts and content, as they will undoubtedly control users’ ‘GlobalCoin’ accounts. If Mark Zuckerberg determines your political views make you persona non grata, you might have to accept bitcoin.
This article was edited by Gerelyn Terzo.
Last modified: January 10, 2020 3:29 PM UTC