RBC Says Facebook's Libra Could Be A 'Watershed Moment' For Cryptocurrency

Facebook, Inc. FB's launch of its own branded digital currency called Libra could prove to be a "watershed moment," according to RBC Capital Markets.

The Analyst

RBC's Mark Mahaney maintains an Outperform rating on Facebook with a $250 price target.

The Thesis

Facebook's Libra addresses the need to create a digital currency and infrastructure to power the "internet of money," Mahaney wrote in a note. The platform will be built on a blockchain backed by a reserve of assets that gives the digital currency intrinsic value. The platform will also be overseen by the independent Libra Association.

Facebook's "White Paper" on Libra calls for a new programming language for the Libra protocol called Move, Mahaney wrote. Transactions will be based on user-defined smart contracts based on the new protocol.

Overall, Facebook's goal is to create "a decentralized, programmable database designed to support a low-volatility cryptocurrency that will have the ability to serve as an efficient medium of exchange for billions of people around the world."

Facebook's initiative boasts similarities to Apple Inc. AAPL's launch of the iOS platform to developers more than 10 years ago, according to Mahaney.

Price Action

Shares of Facebook were trading higher by 2.4% at $193.50 ahead of Tuesday's market open.

Related Links:

Legal Expert Breaks Down Antitrust Risk For Big US Tech Stocks

Heavy On Alphabet And Facebook, This ETF Earns A Neutral Rating

Market News and Data brought to you by Benzinga APIs
Comments
Loading...
date
ticker
name
Price Target
Upside/Downside
Recommendation
Firm
Posted In: Analyst ColorCryptocurrencyTop StoriesMarketsAnalyst RatingsBlockchainFacebook LibraLibraMark MahaneyRBC Capital Marketssocial media
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!