• CFTC wants to discuss regulatory details with Facebook
• Facebook has continued to consult widely
• Only time will tell whether GlobalCoin will be the game changer

Facebook Inc. is reportedly talking to the United States’ derivative regulator, the Commodity Futures Trading Commission (CFTC). FB has plans for developing its own digital currency, GlobalCoin.

Seek to Understand

According to a report by the Market Watch, quoting the Financial Times on June 2, 2019, citing Christopher Giancarlo, the head of the CFTC, the social media giant is in the early stages of talks with the regulator. The regulator seeks to understand whether the company’s planned digital coin will fall under CFTC’s jurisdiction. The media quoted Giancarlo stating:

“We’re very interested in understanding it better […] we can only act on an application, we don’t have anything in front of us.”

Talks with the US and the UK

As per the Financial Times report, Facebook has been busy contacting central banks and regulators seeking guidance on the eagerly awaited crypto offering. The WSJ reported last month that the social media giant was recruiting financial firms and online retailers for a $1 billion funding for its upcoming stablecoin.

Facebook has also reportedly held talks with the United States and the United Kingdom’s governments to discuss opportunities for its digital currency. The cryptocurrency which is being spearheaded under the company’s project Libra is aimed at along Facebook’s users to transfer money across the borders besides making online purchases.

Too Soon To Decide

According to the FT report, CFTC head Giancarlo believes it’s too soon to decide whether GlobalCoin falls under CFTC’s regulatory remit but added that if the cryptocurrency will be backed by the U.S. dollar there could be fewer chances for derivatives to be tied to it.  Giancarlo further told the Financial Times magazine that one top compliance issue by regulators is whether and how Facebook will adhere to and implement the anti-money laundering and know-your-customer measures.

Launch in 2020

As Facebook burns the midnight oil in its plans for GlobalCoin, insiders in the tech industry are divided on the prospect of FB’s much-anticipated digital currency. While some believe the FB coin will be the game changer that spurs worldwide adoption, others believe it is an expensive turkey that won’t go too far.  

The social media giant hasn’t commented on the latest news regarding its digital coin but reports in the media indicate that Facebook is likely to launch the GlobalCoin in 2020. The company went on a hiring spree and has reportedly got over 60 employees working quietly on the stablecoin project.