Visa, Mastercard and PayPal will work together with Facebook for the launch of a new crypto coin, called Libra.
Libra is designed as a stable coin, which means its value will not suffer from daily fluctuations and will be suitable for everyday transactions.
The coin should be introduced next year and if successful at a point in time may compete with conventional payment systems like PayPal, Visa and Mastercard.
For the time being, however, according analysts sited by Bloomberg the traditional payment companies will benefit from participating into the project, because that way they will be better prepared for the potential competition that might still be years away.
“It’s not unusual for the incumbents — Visa, Mastercard, PayPal — to partner with a disruptor. They would at least want to participate in how this product is being developed.” comments Harshita Rawat, an analyst at Sanford C. Bernstein, cited by Bloomberg.
The payment companies are part of the Libra Association and will oversee how the new crypto coin is managed.
After the announcement about the creation of the new crypto coin, Facebook shares rose 1.4% to nearly 192 USD.