Shares in Facebook rose dramatically on the news the California-based tech giant would be launching its own cryptocurrency in 2020.
Mark Zuckerberg’s brainchild is the major stakeholder in Calibra – the mothership over the Libra coin which was announced this morning.
Shortly after news of Facebook’s intention was broken on coinrivet.com, the company’s stock skyrocketed.
Premarket trading from Monday’s close of $189.01 a share climbed almost 2%, triggering fairly bullish scenes on Wall Street.
As news of the potential announcement began to ripple across trading halls, many analysts were predicting positive market movements.
In a note to clients on Monday evening, SunTrust’s Sal Catrini said: “Facebook’s cryptocurrency project “has the potential of putting the company front and centre in areas beyond advertising, including commerce and financial services.”
Important
It was a view echoed by RBC Capital Markets’ analysts Mark Mahaney and Zachary Schwartzman who issued a report stating: “We believe this may prove to be one of the most important initiatives in the history of the company to unlock new engagement and revenue streams.”
Facebook says it expects to profit massively from Libra through its subsidiary Calibra which will host digital wallets.
A lengthy white paper was also released with this morning’s announcement. Within it, Facebook stresses one of the key uses for Calibra will be in cross border payments that will allow users to transfer funds between Libra and fiat currencies with no fee.
HOW COIN RIVET BROKE THE LIBRA STORY: https://coinrivet.com/breaking-news-facebook-announces-crypto-launch/
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.