Report: Facebook plans to create independent foundation to manage its cryptocurrency; will charge members $10M licensing fees for right to operate node
June 5, 2019, 4:35PM EDT
1 min read
Facebook is creating an independent foundation to govern its cryptocurrency, according to a report by The Information. The social media giant has reached out to dozens of financial institutions and tech companies who contribute capital to the foundation and help manage the cryptocurrency's network.
According to The Information's sources, Facebook plans to license out the right to operate nodes on its new cryptocurrency network, charging companies $10 million apiece for the privilege. Node operators will also be allowed to send a representative to the independent foundation. Facebook hopes to launch its network with 100 nodes, generating $1 billion in licensing fees. The firm then plans to use these fees to back its cryptocurrency with a basket of currencies and low-risk securities from different countries.
Facebook's cryptocurrency will primarily live in Facebook's app ecosystem, but the firm plans to partner with merchants to accept it for payment. Facebook also plans on adding physical crypto ATMs to exchange local currencies for its token. The Information also reports that while CEO Mark Zuckerberg has taken a personal interest in the project, Facebook's COO and CFO have been skeptical of it.