Would You like Your Salary to be in Cryptocurrency? Facebook has an Option for Its Employees Working on the Libra Project
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Last week, Facebook announced the launch of its cryptocurrency called Libra. The news took the entire cryptocurrency network and the payments industry by the storm and even helped Bitcoin cross USD 10,000 level.
Having said, it looks like the first few users of the Libra are going to be Facebook employees working on the Libra project.
According to a US-based tech news platform The Information’s report, Facebook employees working on the project can choose to be paid in the cryptocurrency token instead of hard cash.
Why Does it Make Sense
Unlike Bitcoin on Ether, Libra is a stable coin i.e it is designed in a way to avoid market volatility and is backed by a reserve. According to Libra’s whitepaper, the cryptocurrency is backed by a basket of currencies and assets will be held in the Libra Reserve, which is built from two sources i.e. the investors and users, for every Libra that is created.
The reserve will be invested in low-risk assets, such as bank deposits and government securities that will yield interest over time and help the cryptocurrency preserve its intrinsic value. To top it all, in order to encourage adoption among its users, the association will pay out incentives in Libra coin to its founding members including players like Uber, Visa, Paypal, eBay, Mastercard, etc.
Presently, there are more than 25 founding members and according to Mark Zuckerberg’s Facebook post, he is hoping the Libra Association could include at least 100 members before the cryptocurrency’s launch in 2020.
Will It Work?
Though Facebook or Zuckerberg didn’t confirm the tech platform’s news, it would certainly be interesting to watch how many of the employees opt to get paid in Libra. But this is not the first time a tech platform is introducing its offering to its employees. In the past, several tech platforms staff has been asked to opt for its company’s products or services and a classic example of this is Paytm.
Last year, in order to encourage the adoption of its payments bank arm, a fintech company started crediting its employees’ salary to Paytm Payments Bank. However, as per RBI mandate, the payments bank cannot hold a deposit of more than INR 1 lakh. Hence, employees who would earn more than INR 1 lakh had to transfer the amount to other bank accounts or the top up amount would get converted into a fixed deposit.
Coming back to Libra, it’s too early to talk about its payment-related services. But we at Entrepreneur spoke to a communication expert that works with several blockchain companies among other new age tech companies to understand if service providers are okay to get paid in the virtual currencies.
Speaking from her experience, Rachna Baruah, Founder of Madchatter Brand Solutions, says she wouldn’t prefer taking payments in cryptocurrencies.
“The crypto market, while as visionary and lucrative it is, the market is still intangible, while services that I provide are tangible, with clear goals and deliverables. Paying in cryptocurrencies means there is volatility attached to the quoted amount for the services rendered, as well as the fear of certain ICOs not working out. As a business owner and service provider, there are employees and other costs those needs to be covered, which become tricky when FIAT currencies aren't involved,” she added.
Whether Facebook employees will opt for Libra and how will it impact their lifestyle is what time could tell. Meanwhile, fintech experts across the globe are more curious to see how Libra will revolutionise the entire payments industry and sideline other stable coins along with Bitcoin and Ether.